homework help

Concepts of Working Capital

Trust our experienced homework helpers for quick assistance and original solutions.

  • Budget friendly
  • On-time delivery
  • Money-back guarantee
Please enable JavaScript in your browser to complete this form.

Our Expert Writers

We proudly boast a team of expert professionals with verified academic credentials, selected for their proven skills and flexibility through a strict process.

Engage with experts from the top universities across the globe.

The prime objective of financial management is maximizing the wealth of investors and its shareholders. This can be possible if the company earns profit in a considerable amount. As this profitable structure completely depends on sale, the sale volume cannot be directly converted into cash at aninstant.

This is simply because of time gap- A time gap that is created between theselling of products and obtaining of the cash. During this time, every company requires some amount of money to keep on the flow of production on a regular basis. This amount is termed as ‘working capital’. If the company does not have anadequate amount of working capital, then it will be hard to remain in the same position after acertain interval of time.

In other words, working capital means the amount of money that is required for daily expenses of any organization. It can also be defined as the capital that is circulated or revolved around the organization on a daily basis.

  1. S. Mill has defined working capital as the total current asset that is required for businesses.

According to Shubin, “Working Capital is that amount of money which is necessary to cover the operating cost of an enterprise.”

According to Gesterrberg, “Working Capital is the excess amount that is required over current liabilities.”

Thus,

Net Working Capital = Current Assets – Current Liabilities

Types of Working Capital

Working Capital is categorized into two on the basis of time. This includes:

  1. Permanent Working Capital or Core Current Assets
  2. Temporary Working Capital
  1. Permanent Working Capital

It can be defined as the capital asset that is required to run an organization on a regular basis. Permanent Working Capitalis also termed as Core Working Capital.In other words, it can be explained as the minimum amount of money that is investedin running a business at its minimum level of production on a permanent basis.

  1. Temporary Working Capital

Sometimesorganization requires capital investment on a seasonal basis. This investment of money is considered to be the Temporary or Seasonal Working Capital. Or, with the increase in demand for some product, an organization needs to invest more. This amount of money is termed as Temporary Working Capital.

In other words, it can also be defined as the amount of money that fluctuates from time to time and depend upon the business activities is called Temporary or Variable Working Capital.

Concepts of Working Capital

The concepts of working capital are divided into two categories:

  1. Gross Working Capital
  2. Net Working Capital

Gross Working Capital

It refers to the amount of money that represents the investment. This investment will be for current assets that include inventories, bills receivables and marketable securities.

Net Working Capital

It refers to the excess amount of money over the current liabilities. It is mostly considered simply as ‘Working Capital’.

Operating Cycle

In the modern business strategies, every company faces severe competition to survive in the global market. Each of them produces goods as per the demand. In this context, it is difficult to get the sale of all the products and get back the cash immediately.

Starting from the purchase of company’s raw material to its cash generation process, there remains a gap. This time gap is usually called as the Operating Cycle of the business.

Different Stages of Operating Cycle:

  1. Conversion of cash into the raw material
  2. Conversion of raw material into the work in progress
  3. Conversion of work in progress into the finished goods
  4. Conversion of the finished goods into the debtors
  5. Conversion of debtors into the cash

Concepts of working capital

Links of Previous Main Topic:-

Links of Next Finance Topics:-

Your Price: $11.00 $10.00

Pricing may change based on requirements

Descriptive text for the image

Get Homework Help In

Maths and Statistics

Science

Humanities & Arts

l

Essay Writing

How Our Homework Service Works

FAQ number 1

Share your requirements

FAQ number 2

Make secure payment

FAQ number 3

Get homework answers

FAQ - Frequently Asked Questions

Discover quick answers in our FAQ, covering the most common customer questions about our homework help service.

Is your homework service confidential?

M
L

Absolutely! Confidentiality is one of the basic guarantees of our service at MyHomeworkHelp.com.

When our customers make their homework orders, they know their information remains 100% confidential.

Even your homework writer will not be provided with your personal details. So, when you hire a professional homework helper on our website, rest assured that your information will remain private and safe.

For a comprehensive understanding of how we protect your privacy, please refer to our Privacy Policy.

Who will help me with my homework?

M
L

We work with subject experts from all over the world. We hire them with the help of complex tests in the disciplines of their expertise. We also verify the IDs and academic transcripts of our homework writers to be sure that our experts have a bachelor's or master’s or a PhD degree. This is how we can be sure of the proficiency of our panel of experts who will help you with your homework.

Is it legal to ask for help with homework?

M
L

Seeking homework help is perfectly fine and shows your proactive approach to overcoming challenges. But it's important to use our homework service to enhance your understanding, not to replace your own efforts.

Our homework service offers original solutions for personal use, including:

  • Generating ideas or arguments for your research.
  • Deepening your subject comprehension.
  • Direct citation, with proper referencing.

However, it's crucial to avoid plagiarism by not submitting our work as your own. Make sure to check your institution's academic integrity policies before using our services. Our goal is to support your educational journey in a responsible and beneficial way. Refer our honor code for more details.

Is myhomeworkhelp.com legit?

M
L

Yes, myhomeworkhelp.com is completely legitimate. We've been successfully connecting students with top experts worldwide since 2012, offering direct, secure communication for a seamless learning experience. With over thousands of students helped and a commitment to innovative, effective education tools, we're dedicated to making learning easier and more accessible for everyone.

You can read our reviews here on Trustpilot and Sitejabber (Independent, verified reviews from buying customers) like you!

Is there a possibility of plagiarism in my completed order?

M
L

Unlike our competitors who use cheap and ineffective in -house plagiarism software, MyHomeworkHelp.com uses credible software to check your homework solution originality. We guarantee that your paper will pass TurnItIn checks with a low percentage of similarity. In addition, we also check submitted papers for ai-content using Originality.ai.

You will receive a complemantary plagiarism free report with your completed order.

What makes you one of the best homework help website?

M
L

We are not number 1 (yet!). We're an independent, bootstrapped business standing up to Big EdTech for last 12 years. So it means a lot that folks like you are willing to consider our services for your educational needs.

Myhomework Help is recognized as one of the premier websites for homework answers for three key reasons.

  1. Firstly, we pride ourselves on the expertise and qualifications of our tutors/experts, who are selected through a rigorous vetting process to ensure they can provide best academic assistance across a wide range of subjects.
  2. Secondly, our response time to student inquiries is fast (as early as few minutes), reflecting our understanding of the importance of timely support in an academic setting.
  3. Lastly, we keep our pricing very student friendly. Our aim is to provide the best learning experience to students like yourself without burning a hole in your pockets.