Series XVEasyFinancial Statements Analysis

Net working capital of a company is calculated as:

AEquity minus debt
BTotal assets minus total liabilities
CFixed assets minus depreciation
DCurrent assets minus current liabilitiescheck_circle

Correct answer

D. Current assets minus current liabilities

lightbulbDetailed Solution

Net working capital = current assets − current liabilities. It measures a firm's short-term liquidity and its ability to fund day-to-day operations. Positive working capital indicates current assets exceed near-term obligations; persistently negative working capital can signal liquidity stress.

Reference: NISM Series XV Research Analyst, Chapter 2.

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