Explain about net working capital concept, Financial Management

Assignment Help:

Q. Explain about Net Working Capital Concept?

Net Working Capital Concept: - Net working capital demotes to the difference among current assets and current liabilities. Current liabilities are those maintains of outsiders who are expected to mature for payment within an accounting year and include bills payables, creditors and outstanding expenses. Net working capital is able to be positive or negative.

A positive net working capital will happen when current assets exceed current liabilities. A negative Net working capital takes places when current liabilities are in excess of current assets.

Net Working Capital = Current Assets - Current Liabilities

According to Lawrence. J. Gitmen: - 'The most general definition of net working capital is the difference of firm's current assets as well as current liabilities'.


Related Discussions:- Explain about net working capital concept

Working capital turnover, Definition of 'Working Capital Turnover': A ...

Definition of 'Working Capital Turnover': A calculation comparing the depletion of working capital to the generation of sales over a provided period. This provides some useful

Analyze the corporate financial statements, You are currently an Analyst wo...

You are currently an Analyst working for a finance publication firm and as part of your responsibilities; you are required to provide a monthly forecast and analysis of certain com

Testing the hypothesis - chi square test, Testing the Hypothesis To tes...

Testing the Hypothesis To test the null hypothesis, we compare the observed and the expected frequencies. If the actual and the expected values are nearly equal to each other w

Social assistance program for the elderly, Social Assistance Program for th...

Social Assistance Program for the Elderly For the elderly destitutes, the Central and many State Governments have designed several social assistance programs. Under the nationa

Types of fixed income securities or bonds, Types of Bonds 1. Secured ...

Types of Bonds 1. Secured Versus Unsecured Bonds 2.  Senior versus Subordinate Bonds 3.  Registered and Unregistered Bo

Floor Brokers, Floor Brokers These people have the responsibility of ex...

Floor Brokers These people have the responsibility of executing the trades forwarded by the FCMs on the floor of the exchange. They can also trade for their own account. They w

Determine the concept of measuring the rate of return, Determine the concep...

Determine the concept of Measuring the Rate of Return The rate of return is total return the investor receives during holding period (the period when security is owned or held

What do you mean by gross working capital, Q. What do you mean by Gross wor...

Q. What do you mean by Gross working capital? Gross working capital: - Gross working capital demotes to firms investment in current assets. Current assets are the assets which

Explain about the financial management, Explain about the Financial managem...

Explain about the Financial management Financial management is concerned with efficient use of a significant economic resource (input), namely, capital. It's, so, argued that p

Liabilities, Liabilities The company must take into account the nature ...

Liabilities The company must take into account the nature of its liabilities as well as its solvency position. Cash Flows: Besides the investment yields, money flows as paid

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd