alleryStart learning →Net working capital is current assets less which figure?
ACurrent liabilities
BConstant liabilities
CContract liabilities
DCurated liabilities
Answer & Solution
Correct answer: A. Current liabilities
1. Gross working capital counts only what is owned.
2. The net version also allows for what is owed within the year.
3. Net working capital is the more refined concept of the two.
4. It is current assets less current liabilities.
_Source: OpenStax Principles of Finance (CC BY 4.0), Ch 19 'The Importance of Trade Credit and Working Capital in Planning', sections 19.1-19.5_
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