Distinguish between fixed and working capital requirements

1.	Distinguish between fixed and working capital requirements
Answer» ANSWER: Comparison Chart BASIS FOR COMPARISONFIXED CAPITALWORKING CAPITALMeaningFixed capital refers to the investment of the ENTERPRISE in long term ASSETS of the company.Working capital means the capital invested in the current assets of the company.Comprise ofDurable goods whose useful life is more than one accounting period.Short term assets and liabilitiesLiquidityComparatively illiquid.Highly liquid.UsesUsed to BUY non-current assets for BUSINESS.

Answer»

Comparison Chart

BASIS FOR COMPARISONFIXED CAPITALWORKING CAPITALMeaningFixed capital refers to the investment of the ENTERPRISE in long term ASSETS of the company.Working capital means the capital invested in the current assets of the company.Comprise ofDurable goods whose useful life is more than one accounting period.Short term assets and liabilitiesLiquidityComparatively illiquid.Highly liquid.UsesUsed to BUY non-current assets for BUSINESS.

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Distinguish between fixed and working capital requirements

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