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What is Working Capital

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Working capital is a financial metric which represents operating liquidity of a business enterprise. It is a measure of a company’s efficiency and its short-term financial position.Working capital is the difference between the current assets and the current liabilities. Working Capital = Current Assets – Current Liabilities Current Assets includes Accounts Receivable (Bills receivable and Sundry Debtors less provision for doubtful debts), Inventories, Cash and Cash Equivalents and Other Current Assets (excluding Loose tools, Stores and Spares and…