What Effect Is Likely at the End of the Life

question 66

Multiple Choice

What effect is likely at the end of the life of a project that required a $20,000 investment in net working capital?

• A) The $20,000 must now be paid by the firm.
• B) The firm receives a $20,000 cash inflow.
• C) Taxable income is reduced by $20,000.
• D) No effects are expected because the $20,000 is now a sunk cost.