Net working capital is equal to
A) total assets minus total liabilities.
B) current assets minus total liabilities.
C) total operating capital minus net income.
D) current assets minus current liabilities.

Question

Quizplus · Accepted Answer

Net working capital is the difference between current assets and current liabilities of a company. Therefore, option D, current assets minus current liabilities, is the correct answer. Option A is incorrect because it refers to the total assets and total liabilities of a company, while option B and C are incorrect because they are not equivalent to the definition of net working capital.

Net Working Capital Is Equal to