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Question : Which of the following tells the working capital?

Option 1: Difference between Current Assets and Fixed Assets 

Option 2: Difference between Current Assets and Current Liabilities

Option 3: Difference between Current Liabilities and Current Assets

Option 4: None of the above.


Team Careers360 20th Jan, 2024
Answer (1)
Team Careers360 21st Jan, 2024

Correct Answer: Difference between Current Liabilities and Current Assets


Solution : Current Assets - Current Liabilities = Working Capital
The working capital formula calculates the amount of short-term liquid assets available after short-term liabilities are paid off.
Hence 3 is the correct answer.
 

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