Question: why is there a -25 in the current assets part of the net working capital calc Example 2019 2020 Sales 1,000 1,200 Cost of Goods

why is there a -25 in the current assets part of the net working capital calc

why is there a -25 in the current assets part of
Example 2019 2020 Sales 1,000 1,200 Cost of Goods Sold 700 850 Depreciation 30 35 Interest Expense 40 50 Taxes (38%) 87.4 100.7 Profit After taxes 142.6 164.3 Capital Expenditures 40 40 Accounts Receivable 50 60 Inventories 50 60 Accounts Payable 20 25 . 2020: FCF = EBIT*(1-T) + Depreciation - CAPX - ANWC EBIT = 1,200 - 850 - 35 = 315 - T=38% - ANWC = (60+60-25) - (50+50-20) = 15 - FCF = 315 * (1-.38) + 35 - 40 - 15 = 175.3

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