The Recapture of Net Working Capital at the End of a Project

question 151

Multiple Choice

The recapture of net working capital at the end of a project will

• A) increase terminal year free cash flow.
• B) decrease terminal year free cash flow by the change in net working capital times the corporate tax rate.
• C) increase terminal year free cash flow by the change in net working capital times the corporate tax rate.
• D) have no effect on the terminal year free cash flow because the net working capital change has already been included in a prior year.

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Definitions:

Standardized Part

Components or items that are manufactured in large quantities to uniform specifications, ensuring compatibility and interchangeability.

Gantt Chart

A visual project management tool that displays tasks or events along a time axis, allowing for the planning and tracking of project progress.

PERT Chart

A project management tool used to schedule, organize, and coordinate tasks within a project, standing for Program Evaluation and Review Technique.