How to manage working capital
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Hi Reader
The last week was very busy for me because of my sister-in-law’s wedding. That is why I am writing a short Accounting Guide for this week (does not includes practice questions and solutions).
You know what is working capital, how to calculate and analyze it. But do you know everything about working capital that an accountant needs to know? The duties of an accountant are evolving day by day. Today, an accountant should not only know how to calculate and analyze working capital, but he/she should be able to propose solutions for covering the shortage of working capital. This is called working capital management.
This week’s “Accounting Guide” is about working capital management
Concept description
What is working capital management
Working capital management is a technique that help businesses to make the most of available current assets and ensure the flow of cash for offsetting the current liabilities and operating expenses.
The main purpose of working capital management is to optimize the operational ability of the company. The efficient management of working capital helps in running the day-to-day operating activities of a firm smoothly.
There are many different ways to manage the working capital. I have written a complete blog post about the working capital strategies. Click below and have a look at the various strategies of working capital management.
| Best working capital management strategies |
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Hira Aziz
Did you receive it from a friend? Subscribe here for free. Accounting Drive Hi Reader, I hope you are good and doing great. You may be wondering why I have not sent you the Accounting Guide last week? Well, I have been very busy with my kid because of his examination. That is why I could not write the newsletter for you. But today, you got good news. Ta da, you are going to learn a new topic. You have learnt about the working capital; what it is, how to calculate, analyze and manage it. In...
Did you receive it from a friend? Subscribe here for free. Accounting Drive Hello Reader How are you doing? Hopefully, you will be fine and doing well. Last week you learnt about the management of working capital. You are aware of the best working capital management strategies. While managing working capital if you or your manager face shortage of funds for working capital. How would you solve this issue? Can you suggest any helpful source of getting WC funds to your manager? Do you know how...
Did you receive it from a friend? Subscribe here for free. Accounting Drive Hello Reader How are you doing? You learnt and practice about the concept of working capital and the difference between net and gross working capital. Now it’s time to learn how to analyze Working capital. This week’s “Accounting Guide” is about the analysis of working capital Concept description What is working capital analysis? Working capital analysis is the process of calculating and interpreting the working...