Capital Budgeting - Recapture NWC

[archived_user]

Hey, I have a question NWC recapture, for replacement analysis and normal capital budgeting problems do we always assume that the working capital invested will return to zero at the end of the project?

 

[archived_user]

Yes.
Why wouldn’t it?
You’ll sell the inventory, collect the accounts receivable, pay off the accounts payable, and so on.