The change in net working capital-regardless of whether an increase or decrease-is not taxable because it merely involves a net build-up or reduction of current accounts.

Question

Quizplus · Accepted Answer

The change in net working capital is not a taxable event as it involves the movement of current accounts and does not result in any income or expense for the business. Therefore, it is considered a non-taxable item for accounting and tax purposes.

The Change in Net Working Capital-Regardless of Whether an Increase