Working Capital Loan (2017 Update)
Working Capital Loan Any business whether big or small, struggling or efficient requires a working capital. This amount depends on the strength of the business. This too brings us to the question: What is working capital and why do business require it? What is a working capital loan? Net Working Capital Net Working capital is defined as the excess of current assets over current liability. This excludes any bank finance. Both the promoters and a working capital loan funds this new working capital. Just to make things clearer, any asset on the balance sheet which could be converted into cash in one year or one operating cycle is classifies it as a current asset. Also, any liability on the balance sheet which is repayable in a year or one operating…