Financial Ratios - Working Capital Turnover
Working Capital Turnover
Working capital refers to the capital required by the firm to run its day to day operations. To run the day to day operations, the company needs certain type of assets. Typically such assets are – inventories, receivables, cash etc. If you realize these are current assets. A well managed company finances the current assets by current liabilities. The difference between the current assets
and current liabilities gives us the working capital of the company.
Working Capital = Current Assets – Current Liabilities
-zerodha
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