What type of tax consequence is associated with the recovery of net working capital?
A) A firm must pay tax and a penalty.
B) There is no tax consequence.
C) The firm must pay capital gains tax.
D) The firm must pay ordinary income tax.

Question

Quizplus · Accepted Answer

The recovery of net working capital typically does not have a tax consequence because it is considered a return of capital rather than a gain.

What Type of Tax Consequence Is Associated with the Recovery