If SuperMart Decides to Offer a Line of Groceries at Its

Multiple Choice

If SuperMart decides to offer a line of groceries at its discount retail outlet, inventories are expected to increase by $1,200,000, accounts receivable by $300,000 and accounts payable by $500,000. What is the cash outflow for working capital requirements?

A) $2,000,000
B) $1,700,000
C) $1,500,000
D) $1,000,000