Working capital is a measure of:

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Does working capital measure liquidity?
Posted by:
Mohammad Iqbal Abubaker
26-March-2017

a.consistency.

b.liquidity.

c.profitability.

d.solvency.

e.none of the options listed

Project Finance Cash Flow Forecasting Financial Reporting Financial Systems Feasibility Studies

Question added by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies
Date Posted: 2015/06/07

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12 Answers

by Alex Al Yazouri , General Manager , Al Mushref Cooperative Society

b.>>>>>>>>>>>>>>>>>> liquidity.

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by khaled elkholy , HR MANAGER , misk for import & export

B. Is correct answer..............................m

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by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies

Option B is the right answer.

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by Shazia Anees , Assistant Manager Finance , Arham Trading Company

option b ===================

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by Wasim khan wazir , Finance Specialist , Mott Macdonald

Working capital is a measure of liquidity. Option B correct

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by Mohammed Ibrahim AlAgroud , Credit Supervisor , Sulfah Financing Company

'Working Capital'

A measure of both a company's efficiency and its short-term financial health. The working capital is calculated as:

Working Capital

The working capital ratio (Current Assets/Current Liabilities) indicates whether a company has enough short term assets to cover its short term debt. Anything below1 indicates negative W/C (working capital). While anything over2 means that the company is not investing excess assets. Most believe that a ratio between1.2 and2.0 is sufficient.Also known as "net working capital".

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