What is Working Capital And How Can It Help A Business
What is Working Capital?
Working Capital
– is the difference between the current asset and Current Liability.
It shows the overall health of a business.
How do I figure out my businesses Working Capital?
To understand this we need to
define some terms:
Current asset
- cash or any resource that can be turned into cash
quickly
Current Liability
- anything a company owes money on
Cash Flow
- cash that is
generated over a specific amount of time and is never equal to the
net profit of a company.
After you know this
It is a simple formula:
Total Current Assets - Total Current Liability = Working
Capital
When can a Working Capital Financing Come in Handy?
Businesses can have seasonal sales fluctuations, inconsistent cash flows,
growth of a business that causes expansions or remodeling, or event unexpected
repairs that cause a business to need a little cushion of cash to keep the
lights on. That is when a working capital Financing can come in handy by
offering a short-term funding solution to help with everyday business
operations.
So now that you are more informed about Working Capital,
why not let us help your business today.
Click here to
apply now
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