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    Question

    Net Working Capital (NWC) is defined

    as:
    A Current Assets Γ· Current Liabilities Correct Answer Incorrect Answer
    B Current Assets + Current Liabilities Correct Answer Incorrect Answer
    C Current Assets – Current Liabilities Correct Answer Incorrect Answer
    D Fixed Assets – Current Liabilities Correct Answer Incorrect Answer
    E Net Worth – Fixed Assets Correct Answer Incorrect Answer

    Solution

    NWC = CA – CL. Positive NWC shows liquidity to meet short-term obligations, while negative NWC indicates working capital stress.

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