1. #1
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    What is meant by working capital in a Business Organization?

    Good morning sir
    What is mean by working capital in business organisation





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  3. #2
    arunsatbir
    Join Date
    Apr 2012
    Posts
    158

    Re: What is meant by working capital in a Business Organization?

    The Working capital is cash balance.in any Organization.they used it day to day operation .its also called a current capital of any Organization.in Accounting called its liquid assets.it is computed by deducting by current liabilities from current assets.the amount of available working capital is a measure of a firm abillity to meet its short term object.
    its source -Net income and short term loan.and other short term Assets.




  4. #3
    chinmayee
    Join Date
    Apr 2012
    Posts
    96

    Re: What is meant by working capital in a Business Organization?

    Dear friend

    Working capital is a financial term which represents operating liquid cash available to a business or organization or other entity.

    It includes fixed assets such as plant and equipment, working capital is considered a part of operating capital cash balance.

    Working capital is calculated as

    Working capital = current assets - current liabilities.

    If current assets are less than current liabilities, an entity has a negative working capital, also called a working capital deficit.

    Positive working capital is required to ensure that a firm is able to continue its operations and that it has sufficient funds to satisfy both maturing short-term debt and upcoming operational expenses.
    The management of working capital involves managing inventories, accounts receivable and payable, and cash.

    Thank you.

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