Financial Statements

Working Capital

Definition

What is Working Capital?

Current operating assets minus current operating liabilities, with exact components depending on the analysis.

Example in practice

Inventory and receivables exceed payables by ₦200 million.

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Income generated from selling goods or services before expenses are deducted.

The percentage increase or decrease in revenue over a period.

Direct costs attributable to goods or services sold during a period.

Gross profit expressed as a percentage of revenue.

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