A Study on Working Capital Management

Working capital is regarded as the “lifeblood of business”. Every business needs funds for two needs long term funds which are required to create production facilities though purchase of fixed assets, like plant machinery, land, building etc. and short term funds for the purchase of raw materials, payment of wages and other day to day expense etc. These funds are also known as working capital or circulating capital or short term capital. Working capital needs are generally financed through outside sources. Working capital is one of the important measures of a firm's efficiency and represents the total liquid assets available with a firm. It reflects a firm's ability to meet day to day operating expenses and also acts as an indicator of a firm's short term financial health. So a firm has to plan the effective utilization of its working capital in order to maintain equilibrium between liquidity and profitability of the business. Haritha Kumari. Andalavari | Dr. P. Basaiah "A Study on Working Capital Management" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-6 , October 2020, URL: https://www.ijtsrd.com/papers/ijtsrd33149.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/33149/a-study-on-working-capital-management/haritha-kumari-andalavari