Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
006Explain how an increase in accounts payable affects free cash flow.Perella Weinberg PartnersInvestment Banking · Chicago · 2026Perella Weinberg PartnersInvestment Banking · New York · 2026
Say this
It increases free cash flow. An increase in a liability means you have taken the goods but not yet paid, so cash stays in the business. It is a source of cash.
Then walk it
- Accounts payable up means cash held back, so it is a positive working capital adjustment on the cash flow statement.
- The general rule: liabilities up is a source of cash, assets up is a use of cash.
- It does not touch EBITDA or EBIT at all. The expense was already recognised; only the timing of payment changed.
- So unlevered free cash flow rises by exactly the increase in payables, with no tax effect.
- Worth flagging the quality issue: stretching payables to flatter cash flow is a classic window-dressing move, and it reverses the next period.
Where candidates lose it
Getting the direction right but saying nothing about durability. Anyone can memorise the sign. The candidate who adds 'this reverses next quarter and is a red flag if it keeps growing' is the one who sounds like an analyst.
Expect next
- Now do accounts receivable.
- How would you spot a company stretching payables?
- How do you treat a permanent step-up in payables in a DCF?
Reported by candidates at Perella Weinberg Partners (Investment Banking, Chicago, 2026); Perella Weinberg Partners (Investment Banking, New York, 2026). Source: Wall Street Oasis.
Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.