Factors Determining Working Capital Requirement
Various factors influence the requirement of working capital. These factors include the majority of activities of the business. The magnitude of the influence of… Read Article
Disadvantages of Negative Working Capital
Negative working capital (NeWC) is the surplus of current liabilities over the current assets. It is regarded as bad if it disturbs the business… Read Article
How Negative Working Capital is formed? Is it Good or Bad?
In normal circumstances, working capital will never go negative. Negative working capital (NeWC) is formed when short-term liabilities are used for long-term purposes, or… Read Article
Positive Working Capital – Its Advantages and Disadvantages
Positive working capital is the excess of current assets over current liabilities. In other words, when the net working capital is a positive figure,… Read Article
Advantages of Negative Working Capital
The most significant advantage of negative working capital (NeWC) is the holiday from bank funding. It saves the interest cost by getting funds from… Read Article
Negative Working Capital – Formula, Example & its Impact
What is Negative Working Capital?Negative working capital (NeWC) is a financial situation where a company’s current liabilities exceed its current assets. In simpler terms,… Read Article
Temporary or Variable Working Capital
Temporary or variable working capital (TWC) is the temporary fluctuation of net working capital over and above the permanent working capital. It is the… Read Article
Permanent or Fixed Working Capital
Fixed working capital is the minimum investment required in working capital irrespective of any fluctuation in business activity. Also known as Permanent working capital,… Read Article
Invoice or Bill Discounting or Purchasing Bills
The terms ‘invoice discounting’ or ‘bills discounting’ or ‘purchase of bills’ are all same. Invoice discounting is a source of working capital finance for… Read Article
Types of Inventory / Stock
5 Basic types of inventories are raw materials, work-in-progress, finished goods, packing material, and MRO supplies. Inventories are also classified as merchandise and manufacturing… Read Article
Disadvantages of Trade Credit
The advantages and disadvantages of trade credit are important points of consideration before forming any decision relating to trade credit. The key advantage of… Read Article