The MOST ASKED Finance Interview Question - Should Working capital be Negative or Positive?

Should working capital be negative or positive? This is one of the most common interview questions in Finance. In this video, we try and decode that. Working Capital is calculated as Current Assets - Current Liabilities. Common perception is that Current Assets should be higher than Current Liabilities. However, if you run a business, would you want higher receivables or lower receivables. Would you want high inventory or low? Would you want higher payables or low? The answers to the above questions will tell that as a business owner, we would like a negative working capital. ------------------------------------------------------------------------------- Follow us on YouTube -    / finshiksha   LinkedIn -   / finshiksha   Twitter -   / finshiksha   Create a free account on https://www.finshiksha.com , and get complementary access to 3 Finance Courses. Find some of the best courses on Finance on our website. --------------------------------------- FinShiksha is an IIM Calcutta alumnus venture and specializes in education in the financial services domain. But we are more than just education providers; we help you build a career – and work with you during the process. Our programs help a candidate evaluate his/her strengths and hone them, at the same time spotting weaknesses and eliminate them. We teach, we hand-hold and we guide. Our courses are built keeping in mind specific work roles, and are practical and extensive in nature. Many of our courses have projects embedded in those – to enable you to apply what you have learnt in the course. Visit our website https://www.finshiksha.com