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What do you mean by the working-capital of an
organization??? How is it calculated????? Also Define the
importance of liquidity ratio along with its formula.

Question Posted / naveenjoe

Answers were Sorted based on User's Feedback



What do you mean by the working-capital of an organization??? How is it calculated????? Also Defin..

Answer / abdul rashid

Working capital is part of capital that is used for day to
day business requirement(short term). It is calculated by
deducting current liablities from current assests (Cureent
assests-current liabilities = WC).

Current assest divided by current liabilities refers to
liquidity ratio (CA/CL). It measures liquidity position of
an orgainisation.

Is This Answer Correct ?    40 Yes 2 No

What do you mean by the working-capital of an organization??? How is it calculated????? Also Defin..

Answer / hpotter1987

working capital is that part of capital which is used for
day to day oerations like payment of wages various day to
day bills. it is excess of current assets over the current
liabilities.

liquid ratio is the ration of liquid assets to the liquid
liabilities where liquid assets = CA - closing Stock
and liquid liabilities = CL - Bank Overdraft
(refer book jayant mitra for cost and management acoounting)

Is This Answer Correct ?    12 Yes 7 No

What do you mean by the working-capital of an organization??? How is it calculated????? Also Defin..

Answer / naveda

Working capital is used for the day to day business
activities of an organisation.
working capital= current asset - current Liability

Calculation of working capital ratio = Working
capital /Total assets

Is This Answer Correct ?    6 Yes 1 No

What do you mean by the working-capital of an organization??? How is it calculated????? Also Defin..

Answer / dinesh birare

WORKING CAPITAL IS USED IN DAY IN DAY BUSINESS OF AN
ORGANISATION.
WORKING CAPITAL=CURRENT ASSET-CURRENT LIABILITY.
CALCULATION OF WORKING CAPITAL=WOKING CAPTIAL/TOTAL ASSETS

Is This Answer Correct ?    2 Yes 2 No

What do you mean by the working-capital of an organization??? How is it calculated????? Also Defin..

Answer / jayant kumbhare

Definition:-Working Capital means the amount required for day to day business activities is known as Working Capital management.
Formula for Calculatin===>Current Assets - Current Liabilities

Is This Answer Correct ?    1 Yes 1 No

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