One Possible Definition of Net Working Capital (NWC)provided by Your

question 49

Multiple Choice

One possible definition of net working capital (NWC) provided by your authors is:

• A)NWC = A/R + inventory - A/P.
• B)NWC = cash + A/P - inventory.
• C)NWC = A/P + A/R - short-term loans.
• D)NWC = A/R + inventory - long-term debt.

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Definitions:

Financial Information

Data relating to the monetary transactions, assets, liabilities, net worth, and operational results of an individual or an organization.

DuPont Formula

A financial analysis formula that breaks down Return on Equity into three components: operating efficiency, asset use efficiency, and financial leverage.

Decentralized Operation

A business strategy where decision-making powers are distributed among various levels instead of being concentrated at a single point.

Strategic Planning

The development of a long-range course of action to achieve business goals.