What is working capital?
submitted by clint

Frenbo

Working capital is like the cash a company has available for running things day to day.

You can see your working capital by subtracting what you owe in short-term debts from what you own that's liquid (easily cashable).

rich

It's the difference between a company's current assets, (like cash, inventory, and receivables) and its current liabilities, which are bills and debts due soon.

You'd care about working capital when you're trying to see if the company can keep operating for a while, or if it's going to need funding. Important for investing research.