WcINV and NWCinv

CFA Level II
#1

Going crazy memorizing formulas…things are starting to blur nwcinv and wcinv, Are they the same? Different?

#2

NWCinv is the change in WCinv

#3

NWCinv = change in Assets - change in Liability

#4

For computing FCFF/FCFE, you want the NWCinv

#5

phBOOM Wrote: ------------------------------------------------------- > NWCinv is the change in WCinv I think thats wrong.

#6

Pretty sure thats right

#7

phBOOM Wrote: ------------------------------------------------------- > NWCinv = change in Assets - change in Liability This is not right.

#8

NWCinv = [CA-CL (period t)] - [CA-CL (period t-1)]…excluding cash & marketable securities from CA and current interesting bearing liabilities (i.e. notes payable and current portion of LT Debt).

#9

NWC = net working capital. Isn’t this the same as WC? NWCINV and WCINV are indentical right?

#10

Usually NWC (or just WC) is current assets - current liabs, but for FCFF it is (current assets - cash) - (current liabs - st debt) The fixed investment is just the change in fixed assets