Updated October 5, 2023
What are Working Capital Projections?
Working capital projections are the estimated financial figures forecasting the expected changes in a company’s working capital over a specific period. Working capital represents the difference between a company’s assets and liabilities. It indicates the company’s ability to cover its short-term obligations and fund its day-to-day operations.
Step 1 – Using Simple Assumptions
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Working Capital Projection Solutions
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Step 2: Calculate Free Cash Flows using the EBIT Formula
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Forecast of FCFF
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What Next
We learned about working capital projections using simple assumptions in this article. Next, we will look at terminal value. Till then, Happy Learning!
