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If net fixed assets increased by $22,000 during the year, what was the addition to NWC?

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User Nachocab
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1 Answer

7 votes

Final answer:

An increase in net fixed assets does not necessarily result in an addition to net working capital (NWC).

Step-by-step explanation:

The net working capital (NWC) can be calculated using the formula NWC = Current Assets - Current Liabilities. Since the question does not provide information about current assets or current liabilities, we cannot calculate the exact addition to NWC. However, we can say that an increase in net fixed assets does not necessarily result in an addition to NWC. This is because net fixed assets are a part of total assets, which is used to calculate NWC, but the change in net fixed assets does not directly affect the change in current assets or current liabilities.

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User Godbyk
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