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    gypsy1952's Avatar
    gypsy1952 Posts: 1, Reputation: 1
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    #1

    Aug 10, 2007, 06:14 PM
    Net Working Capital
    Paying out a $2 million cash divident has what affect on working capital?
    nicespringgirl's Avatar
    nicespringgirl Posts: 1,237, Reputation: 187
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    #2

    Aug 10, 2007, 06:24 PM
    Net Working Capital=Assets-Liabilities
    When you pay out $2 million cash dividend, you credit cash and debit stockholder's equity-Retained Earnings
    Cash is under Assets, so you can see NWC decreased by $2 million.
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