Working Capital Management

How is Net Working Capital calculated?

• Current Assets + Current Liabilities

• Current Assets - Non-Current Liabilities

• Current Assets - Current Liabilities

• Non-Current Assets - Current Liabilities

Which of the following is considered a current asset?

• Long-term investments

• Cash

• Property, plant, and equipment

• Goodwill

Which of the following is NOT a current asset?

• Inventories

• Prepaid expenses

• Short-term investments

• Trademarks

Current assets are expected to be converted into cash within:

• Two years

• Six months

• One year

• Five years

Which of the following would typically be classified as a cash equivalent?

• Accounts payable

• Prepaid expenses

• Short-term investments

• Equipment

What are current liabilities?

• Long-term financial obligations

• Payment obligations that come due within one year

• Investments made by a company

• Assets that can be converted into cash within one year

Which of the following is NOT a common current liability?

• Notes payable

• Accounts payable

• Accrued expenses

• Retained earnings

What is the first step in the Working Capital Cycle?

• Provide Services

• Billing & Collections

• Purchase Resources and Pay Bills

• Obtain Cash

According to the Working Capital Cycle in the image, what comes after 'Obtain Cash'?

• Provide Services

• Billing & Collections

• Purchase Resources and Pay Bills

• The cycle starts over

What is the third step in the Working Capital Cycle depicted in the image?

• Obtain Cash

• Billing & Collections

• Provide Services

• Purchase Resources and Pay Bills