--%>

Working Capital - Current Assets and Current Liabilities

I do not know the meaning of Working Capital Requirements. I think this should be same to Working Capital (Current Assets – Current Liabilities). There am I right?

E

Expert

Verified

The Working Capital Requirements shows the difference among the current assets essential for the operations of the company (minimum cash holdings, inventories and clients) and the current liabilities without financial debt (provisions and providers etc.). They are different from Working Capital since the latter does consider financial debt. While a company grows, its financial necessities raise more or less proportionally to the Working Capital Requirements.

   Related Questions in Corporate Finance

  • Q : Profitability Ratios Profitability

    Profitability Ratios: These ratios comprise the Gross profit Margin, Net profit Margin, Operating Margin, Return on Equity (ROE), and Return on Total Assets. Such ratios help the firm to examine its profitability, the trend in profits and aid to take

  • Q : Set of conflicts in reducing working

    Give an illustration of a set of conflicts encountered when attempting to reduce working capital?

  • Q : Who published a book regarding

    Who published a book regarding option formula and risk neutrality?

  • Q : Explain Straddle and Strangle Straddle

    Straddle & Strangle: In the case of shorting butterfly spread, it can be seen that the gains are limited. However, there exists another strategy known as straddle which produces unlimited gains. This strategy benefits when the trader expects that

  • Q : How WACC should be computed to begin a

    I cannot seem to begin a valuation. In order to compute E + D = VA (FCF; WACC) I require the WACC and to compute the WACC I need D and E. Where must I start?

  • Q : Expected return for a portfolio What is

    What is the expected return for a portfolio consisting of 200 shares of Nike, 200 shares of Home Depot, and 400 shares of Intel if their expected returns are 10%, 8% and 12% respectively, and their current prices are $25, $50, and $25 per share respec

  • Q : Strategy of Bull Spread State when

    State when market is expected to go up then what is the Strategy of Bull Spread?

  • Q : How can auditor spot acts of creative

    How can auditor spot acts of creative accounting? Means let an illustration, the excess of provisions or the non-elimination of intra group transactions along with value added.

  • Q : Efficient Market Hypotheses Write

    Write Efficient Market Hypotheses in brief?

  • Q : Probability of dividend Universal

    Universal Corporation has the following dividend policy: if the earnings after taxes are less than $1 million, the dividend payout ratio will be 35%, but if these earnings are over $1 million, the dividend payout ratio will be 45%. The EBIT of Universal for next year