There are various advantages and disadvantages of the fund flow statement. One should consider them before forming any view of the sources and uses… Read Article
A fund flow statement is a statement that reflects the relative position of funds of the company over a two-period horizon. It enables analysis… Read Article
Operating CycleOperating cycle and cash operating cycle are used interchangeably, but it’s a misconception. They are different by a small margin, but that makes… Read Article
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
In normal circumstances, working capital will never go negative. Negative working capital is formed when short-term liabilities are used for long-term purposes, or current… Read Article
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
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 (NeWC) is defined as the excess of current liabilities over current assets. While calculating the net working capital, if the figure… Read Article
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
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
Definition of Trade CreditTrade credit is an important Source of Working Capital extended or generated by the business itself. It can be defined as ‘delay… Read Article