Net working capital is calculated by taking the difference between:

Question

Quizplus · Accepted Answer

Net working capital is the difference between a company's current assets (such as cash, inventory, and accounts receivable) and its current liabilities (such as accounts payable and short-term debt). Option A is the formula for calculating total equity, option B is the formula for calculating the cash conversion cycle, and option D is not relevant to net working capital.

Net Working Capital Is Calculated by Taking the Difference Between