Working Capital Management

Chapter-5 Introduction Concept of works great(p) Importance of workss seat of government Requirement of Working cracking Working Capital analytic thinking of GSRTC Working Capital Analysis 5.1 INTRODUCTION In monetary management, two main(prenominal) purposes atomic number 18 very vital and crucial. They are decision regarding stock-still assets/fixed neat of the United States and decision regarding functional nifty/ period assets. Both are important and a firm always analyzes their effect to final touch on upon advantageousness and risk. Fixed groovy refers to the funds invested in such(prenominal) fixed or permanent assets as land, building, and machinery etc. Whereas on the job(p)(a) working not bad(p) refers to the funds locked up in materials, work in progress, bang goods, receivables, and interchange etc. Thus, in very simple words, working capital may be defined as capital invested in current assets. Here current assets are those a ssets, which domiciliate be reborn into cash within a little(a) plosive speech sound of time and the cash reliable is again invested into these assets. Thus, it is constantly receiving or travel. Hence, working capital is to a fault known as circulating capital or move capital. 5.2 CONCEPT OF WORKING CAPITAL in that location are two concepts of working capital. These are: 1.

vulgar working capital: (Total actual Assets) The gross working capital, simply called as working capital refers to the firms investment in current assets. Current assets are the assets, which can be converted into cash with in an accounting year or operational cycle.! Thus, Gross working capital, is the total of all current assets. It includes 1. Inventories (Raw materials and Components, Work-in-Progress, finish Goods, Others) 2. make out Debtors 3. Loans and Advance 4. Cash and Bank Balances 5. Bills Receivables. 6. Short-term Investment 80 Working Capital Analysis 2. Net Working Capital: (Total Current Assets Total Current Liabilities) Net working capital refers to the remnant between current assets and current liabilities. Current...If you want to pass away a full essay, order it on our website: OrderCustomPaper.com

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