What is referred by the Working capital ?
Correct answer: C. Both of them
- A. Assets of business that can be applied to its operation
- B. Amount of current assets that exceeds current liabilities
- C. Both of them
- D. None of them
Explanation
Working capital is commonly expressed as current assets minus current liabilities, called net working capital; current assets alone are called gross working capital. Thus both descriptions can be associated with the term, depending on whether gross or net working capital is intended.
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