Question

some media organizations have reduced the use of paper and plastic by their employees by not purchasing items such as plastic cutlery, paper plates, and foam cups. They then invested in reusable, washable, glass and aluminum flatware and cups instead. is the action related to executive decisions regarding ccc and net working capital, affecting a company's operations?

Answer 1

No, this action does not relate to CCC and net-working capital that affects the company operations as these expenses are part of administrative expenses or other expenses and by shifting from paper and plastic products like plastic cutlery, paper plates and foam cups to reusable, washable glass and aluminum flatware and cups will reduce administration expenses or other expenses. Further, net-working capital is a difference of company current assets and current liabilities (i.e Trade Receivables+Inventory+Cash and Equivalents- Trade payables) and a positive net working capital reflects that the company has sufficient funds to meet current financial obligations and negative net working capital reflects that the company has not sufficient funds to meet current financial obligations.