Gamestop wants to invest in a new division to develop software for video games. The company isevaluating this decision by projecting the working capital needs for the operation. The CFO has developedthe following estimates (in millions of dollars). Assume that Gamestop does not currently have any workingcapital invested in this division. Calculate the cash flows associated with the net working capital andchanges in net working capital for the first five years of this investment.Year 0Year 1Year 2Year 3Year 4Year 5Cash6.12161514Accounts2126242524ReceivableInventoryAccounts51012151719252532PayableNWCANWC

Working capital is the difference between CA investment - CL facilitated. Theoretically, the part of…

heeds fo ting this decision by projecting the working capital llowing estimates (in millions of dollars). Assume that Game al invested in this division. Calculate the cash flows asso ges in net working capital for the first five years of this inves Year 0 Year 1 Year 2 Yea

heeds fo ting this decision by projecting the working capital llowing estimates (in millions of dollars). Assume that Game al invested in this division. Calculate the cash flows asso ges in net working capital for the first five years of this inves Year 0 Year 1 Year 2 Yea

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 4P

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