Which one of the following will increase net working capital? Assume the current ratio is greater than 1.0.
A)paying a supplier for a previous purchase
B)paying off a long-term debt
C)selling inventory at cost
D)purchasing inventory on credit
E)selling inventory at a profit on credit

Question

Quizplus · Accepted Answer

Selling inventory at a profit on credit increases accounts receivable (an asset), without immediately affecting liabilities, thus increasing net working capital.

Which One of the Following Will Increase Net Working Capital