Question
Suppose that Linksys is considering the development of a wireless home networking appliance, called HomeNet, that will provide both the hardware and the software necessary
Suppose that Linksys is considering the development of a wireless home networking appliance, called HomeNet, that will provide both the hardware and the software necessary to run an entire home from any Internet connection. Linksys's receivables are 14.2% of sales and its payables are 15.8% of COGS. Forecast the required investment in net working capital for HomeNet assuming that sales and cost of goods sold (COGS) will be as follows:
Year | 0 | 1 | 2 | 3 | 4 |
|
Sales | $23,578 | $26,463 | $23,579 | $8,694 | ||
COGS | $9,532 | $10,698 | $9,532 | $3,515 |
The required investment in net working capital for year 0 is ____
The required investment in net working capital for year 1 is ____
The required investment in net working capital for year 2 is ____
The required investment in net working capital for year 3 is ____
The required investment in net working capital for year 4 is ____
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