Net working capital is deﬁned as:
A)total liabilities minus shareholders' equity.
B)current liabilities minus shareholders' equity.
C)non-current assets minus non-current liabilities.
D)total assets minus total liabilities.
E)current assets minus current liabilities.

Question

Quizplus · Accepted Answer

Net working capital is defined as current assets minus current liabilities. This represents the amount of operating liquidity available for a company to conduct its day-to-day operations. It is an important measure for evaluating a company's financial health and ability to meet its short-term obligations.

Net Working Capital Is Deﬁned As