ModeldrillWorking capital from days
A financial modeling exercise from Modeldrill. Solve it with a live spreadsheet grid in your browser, with Fill right and Fill down, and it is checked the moment you submit.
The task
Forecast the working capital balances from the day counts in B2:B4: receivables from revenue, inventory and payables from cost of goods sold, each as days out of 365. Then net working capital is receivables plus inventory less payables.
What this exercise teaches
Driving balances from days keeps working capital in step with the business. Shortening receivable days by a week is then a one-cell change that flows into cash.
A hint if you get stuck
Receivables = revenue x days / 365. Inventory and payables use cost of goods sold. Lock the day counts.
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