For Project a in Year 2, Inventories Increase by $12,000

Multiple Choice

For project A in year 2, inventories increase by $12,000 and accounts payable increase by $2,000. Accounts receivable remain the same. Calculate the increase or decrease in net working capital for year 2.

A) Decreases by $14,000
B) Increases by $14,000
C) Decreases by $10,000
D) Increases by $10,000