0
Want this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
What is the reason for negative working capital?
working capital is current assest minus current liabilities ...when working capital become negative that means that urrent liabilities is more than current assets ...in this case the organization could face bancruptcy
What is the optimum working capital?
Optimum working capital is that point where working capital is neither short from requirements nor excess working capital available at any time during fiscal year.
What is a negative capital expenditure?
negative expenditure
What is a working capital statement?
WORKING CAPITAL STATEMENT (WCS) is part of the financial statements' "Statements of Cash Flows or Changes in Financial Position." The WCS normally includes sections covering: Sources of Working Capital, Uses of Working Capital, and Working Capital Changes.
How do you calculate net working capital?
How do you calculate net working capital?
Can a company operate with negative working capital?
yes, a company can operate with negative working capital. the problem of negative arises when the current liablities exceed current assets. there are apporoximately 34 companies which have negative working capital, it includes bharti airtel also
Which company have negative working capital?
Banks for example
What is the reason for negative working capital?
working capital is current assest minus current liabilities ...when working capital become negative that means that urrent liabilities is more than current assets ...in this case the organization could face bancruptcy
Could a firm have negative working capital and still be in great financial shape?
Some companies can generate cash so quickly they actually have a negative working capital.Some extremely efficient companies, such as Wal-Mart, can have negative working capital because they sell goods on the shelf faster than they pay the vendor for the merchandise
Working capital formula?
The formula for calculating working capital is: Working Capital = Current Assets - Current Liabilities. It represents a company's ability to cover its short-term obligations with its current assets. A positive working capital indicates that a company has enough assets to cover its liabilities, while a negative working capital may suggest liquidity issues.
Is Negative Working Capital good or bad?
Negative working capital is good if the following conditions are satisfied : 1.Payment of all short term liabilities on time 2.Good sales and profit margin If the above two conditions are fulfilled, the working capital is funded by cash profits generated from normal operating cycle and there is no strain on payment of liabilities.
Explain the concept of working capital?
Working capital represents a company's ability to cover its short-term operational expenses using its current assets like cash, inventory, and accounts receivable. It is calculated by subtracting current liabilities from current assets. Positive working capital indicates a company can meet its short-term obligations, while negative working capital may signal liquidity issues.
What are the determinate of working capital?
conclusion of determinant of working capital
What is working capital?
Working capital is a measure of a company's operational efficiency and short-term financial health, calculated by subtracting current liabilities from current assets. It represents the funds available for day-to-day operations and is important for assessing a company's liquidity and ability to cover short-term obligations. A positive working capital indicates that a company has more current assets than liabilities, while a negative working capital may suggest potential financial difficulties.
How can you make your negative working capital positive?
first of all please understand that if the company has negative working captial than surely it is going to its grave. to make negative working captial positive is to induce more long term source of financing such as equity. long term dept or bank borrwoings, and also not the least bring the company into profit.
What is the negative effect of a firm's limited capital?
negative effects of a firm limited capital
What is a a working capital?
WORKING CAPITAL STATEMENT (WCS) is part of the financial statements' "Statements of Cash Flows or Changes in Financial Position." The WCS normally includes sections covering: Sources of Working Capital, Uses of Working Capital, and Working Capital Changes.
