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WORKING CAPITAL MANAGEMENT - Coggle Diagram
WORKING CAPITAL MANAGEMENT
Two Components
Current Assets
stock of work in progress
Raw material stock
stock of finished goods
short term investments
Prepaid Expenses
cash
Sundry Debtors
Advance payment of Tax
Bank balance
Current Liabilities
Outstanding expenses
Short Term Borrowings
Sundry Creditors
Provision for Taxation
Bills Payable
Dividends Payable
Advance payments from customers
Concepts of Working Capital
NET CONCEPT
Excess of current assets over current liabilities
GROSS CONCEPT
Amount invested in current assets
TYPES OF WORKING CAPITAL
VARIABLE W C
SEASONAL WC
SPECIAL WC
OTHER TYPES OF W C
BALANCE SHEET WC
CASH WC
PERMANENT W C
INITIAL WC
REGULAR WC
"WORKING CAPITAL IS THE AMOUNT OF FUNDS NECESSARY TO COVER THE COST OF OPERATING THE ENTERPRISE" -Shubin
WORKING CAPITAL IS THE DIFFERENCE BETWEEN INFLOW AND OUTFLOW OF FUNDS