Write short notes on ‘Working Capital’.

Working capital refers to the capital a company uses for its day-to-day trading operations. It represents the difference between a company's current assets (such as cash, accounts receivable, and inventory) and its current liabilities (such as accounts payable and short-term debt). Here are some key points to understand about working capital:

1. Importance of Working Capital: Working capital is essential for a business to maintain its daily operations smoothly. It ensures that a company can pay its short-term obligations and cover operational expenses.

2. Components of Working Capital:

   • Current Assets: These are assets that can be converted into cash or used up within one year, including cash on hand, accounts receivable, and inventory.
   • Current Liabilities: These are the ___ ________ _________ ____ _________ _______ ____ __________ ___ _________.
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