Net working capital is defined as the:
A)current assets of a business.
B)difference between current assets and current liabilities.
C)present value of short-term cash flows.
D)difference between all assets and liabilities.
E)difference between total current assets and cash.

Question

Quizplus · Accepted Answer

Net working capital is calculated by subtracting current liabilities from current assets. This represents the amount of money that a business has available for day-to-day operations. Option B is the only choice that correctly defines net working capital as the difference between current assets and current liabilities.

Net Working Capital Is Defined as The