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- Dictionaryworking capital
noun
- 1. the capital of a business which is used in its day-to-day trading operations, calculated as the current assets minus the current liabilities.
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Jun 27, 2024 · Working capital, also called net working capital (NWC), is the difference between a company’s current assets and current liabilities. It measures a company’s liquidity and...
Jun 8, 2023 · The term working capital refers to the portion of total capital that is used to run a business efficiently and regularly. It is also known as short-term capital, circulating capital, or liquid capital. Working capital can also be viewed as the current assets minus the current liabilities of an organization.
Jul 12, 2024 · Working Capital is a fundamental accounting metric that measures a company’s short-term financial health by subtracting current liabilities from current assets on the balance sheet. The working capital metric is relied upon by practitioners to serve as a critical indicator of liquidity risk and operational efficiency of a particular business.
Dec 27, 2022 · Working capital = current assets - current liabilities. Working capital is an important number when assessing a company's financial health, as a positive number is a good sign while a negative number can be a sign of a failing business. Of note, working capital is also known as net working capital.
Nov 30, 2020 · What is working capital? With a clear definition and realistic examples, learn how to use the working capital formula to make better financial decisions.
Working capital—also known as net working capital—is a measurement of a business’s short-term financial health. Simply put, it indicates your liquidity or ability to pay your bills. You can find it by taking your current assets and subtracting your current liabilities, both of which can be found on your balance sheet.
Working capital is the difference between current assets and current liabilities. It is not to be confused with trade working capital (the latter excludes cash). The basic calculation of working capital is based on the entity's gross current assets.
