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In: Finance

You've collected the following forecasts of working capital needs for next year: (in $ million) Q1...

You've collected the following forecasts of working capital needs for next year:

(in $ million) Q1 Q2 Q3 Q4
Cash 2 2 2 2
Accounts receivable 17 10 12 17
Inventory 10 5 10 12
Accounts payable 6 4 10 12

-1- What are the permanent working capital needs (in $$ million)?

-2- What are the temporary working capital needs in Q4 (in $$ million)?

-3-

According to the matching principle, how much of your working capital needs should you finance with long-term sources of funds (in $$ million)?

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jeff jeffy answered 4 months ago
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