Question

Which of the following is NOT a component of working capital?

A Trade payables Correct Answer Incorrect Answer
B Short-term loans repayable within 12 months Correct Answer Incorrect Answer
C Long-term investments held for strategic purposes Correct Answer Incorrect Answer
D Trade receivables Correct Answer Incorrect Answer

Solution

Working capital is defined as Current Assets minus Current Liabilities. Long-term strategic investments are non-current assets and are not part of working capital.

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