Question

Castle View Games would like to invest in a division to develop software for a​ soon-to-be-released video game console. To evaluate this​ decision, the firm first attempts to project the working capital needs for this operation. Its chief financial officer has developed the following estimates​ (in millions of​ dollars):  ​(To copy the table below and use in​ Excel, click on icon in the upper right corner of​ table.)

		Year 1	Year 2	Year 3	Year 4	Year 5
1	Cash	6	10	15	15	15
2	Accounts receivable	22	22	26	24	23
3	Inventory	6	9	11	12	14
4	Accounts payable	16	19	23	28	33

Assuming that Castle View currently does not have any working capital invested in this​ division, calculate the cash flows associated with changes in working capital for the first five years of this investment. ​(Note: Enter decreases as negative​ numbers.)

The change in working capital for year 1 is ​$ million.  ​(Round to the nearest​ integer.)

The change in working capital for year 2 is ​$ million.  ​(Round to the nearest​ integer.)

The change in working capital for year 3 is ​$ million.  ​(Round to the nearest​ integer.)

The change in working capital for year 4 is ​$ million.  ​(Round to the nearest​ integer.)

The change in working capital for year 5 is ​$ million.  ​(Round to the nearest​ integer.)

Answer 1