How to factor AR into working capital when it varies by time of the month?
I have a deal where working capital has been calculated at $145k. This is a net 30 business with invoicing taking place on the 1st of every month. Depending on what day of the month closing falls, accounts receivable could be as low as $0 or as high as $200k.
Assuming I am keeping the accounts receivables, how should we factor the AR on the day of closing into working capital?