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Classification of Working Capital - Net Working Capital & Gross Working Capital (in Hindi)
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Heena Malhotra
Believe in Conceptual Learning.

U
Unacademy user
mam net k liye kittta padhna h ye to kafi jada h
Heena Malhotra
a year ago
aapko har subject ko kam se kam 7 din , aur 2 hour per day pdhna pdega.. aur ye course 14 hours ka h means exact 7 days 2 hours per day.. :)
yes mam bt sylbs me ittta jada niii h net k
Heena Malhotra
a year ago
syllabus m to bas topics(chapters) ke name h, aap apne according pdh skte ho :)
oķkkk mam
this lesson also ncy
  1. Management of Working Capital By Heena Malhotra


  2. MEANING AND CONCEPT OF WORKING CAPITAL in acounting term working captalis the diference between the current assets and curent labilies f we break down the components of working capital we will fnd working capital as follows Working Capital Current Assets -Current Liabilities By Heena Malhotra


  3. Current Assets: An asset is classified as current when: () Itis expected to be realised or intends to be sold or consumed in normal operating cycle of the entity: (i) The asset is held primarily for the purpose of trading: () It is expected to be realised within twelve months after the reporting period; (iv) It is non- restricted cash or cash equivalent. Generally current assets of an entity, for the purpose of working capital management can be grouped into the following main heads: (a) Inventory (raw material, work in process and finished goods) (b) Receivables (trade receivables and bills receivables) (c) Cash or cash equivalents (short-term marketable securities) (d) Prepaid expenses By Heena Malhotra


  4. Current Liabilities: A liability is classified as current when: (0 It is expected to be settled in normal operating cycle of the entity. (i) The liability is held primarily for the purpose of trading (ii) It is expected to be settled within twelve months after the reporting period Generally current liabilities of an entity, for the purpose of working capital management can be grouped into the following main heads: (a) Payable (trade payables anbls eceivables) (b) Outstanding payments (wages & salary etc.) By Heena Malhotra


  5. Working Capital On the basis of Value On the basis of time Permanent Factuating Gross Net By Heena Malhotra


  6. (a) Value: From the value point of view, Working Capital can be defined as Gross Working Capital or Net Working Capital Gross working capital refers to the fim's investment in current assets. Net working capital refers to the difference between current assets and current abilities. Apositive working capital indicates the company's ability to pay its short-term liabilties. On the other hand a negative working capital shows inability of an entity to meet its short-term liabilties. By Heena Malhotra


  7. (b) Time: From the point of view of time, working capital can be divided into two categories viz, Permanent and Fluctuating (temporary). Permanent working capital refers to the base working capita, which is the minimum level of investment in the current assets that is carried by the entity at all tmes to carry its day to day activities Temporary working capital refers to that part of total working capital,which is required by an entity in addition to the permanent working capital. It is also called variable working capital which is used to finance the short term working capital requirements which arises due to fluctuation in sales volume. By Heena Malhotra


  8. The following diagrams shows Permanent and Temporary or Fluctuating or variable working capital: ry Tempora Temporary Permanent Perm Time Time By Heena Malhotra


  9. Working Capital On the basis of Value On the basis of time Permanent Factuating Gross Net By Heena Malhotra