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Lottie's Boutique needs to maintain 12 percent of its sales in net working capital. Lottie's is considering a 3-year project which will increase sales from
Lottie's Boutique needs to maintain 12 percent of its sales in net working capital. Lottie's is considering a 3-year project which will increase sales from their current level of $110,000 to $130,000 the first year and $145,000 a year for the following two years. When analyzing the project, what amount should be included for net working capital for the last year if the net working capital returns to its original level at that time?
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