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प्रश्न
Amrit is running a ‘transport service’ and earning good returns by providing this service to industries. Giving reason, state whether the working capital requirement of the firm will be ‘less’ or ‘more’.
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उत्तर
Working capital is the amount of capital required for meeting the day-to-day operations of the business. In this case, Amrit runs a Transport Service. This business operates on a large scale of operation, with a higher amount of inventory. He would require a large amount to working capital.
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संबंधित प्रश्न
Match the pairs
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Group A |
Group B |
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a. Fixed Capital |
1. Owned Capital |
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b, Overdraft facility |
2. Bearer document |
|
c. Share certificate |
3. Investment in fixed assets |
|
d. Debentures |
4. Current Account |
|
e. Return on shares |
5. Application Money |
|
|
6. Dividend |
|
7. Investment in current assets |
|
|
8. Borrowed capital |
|
|
9. Savings Account |
|
|
10. Registered Document |
Explain the following as factors affecting the requirement of working capital:
The credit allowed and availed
How does working capital affect both the liquidity as well as profitability of a business?
What is working capital?
Companies with a higher growth potential are likely to
Higher working capital usually results in :
Current assets are those assets which get converted into cash
Current assets of a business firm should be financed through
______ of a firm refers to those assets which can be converted into cash or cash equivalents in a short period of time.
Working capital is calculated as?
______ decision involves the decision regarding the distribution of profit or surplus of the company.
Net working capital may be defined as the:
Dhaval Acharya, after acquiring a bachelor’s degree in Hotel Management joined his father’s chain of vegetarian restaurants in Ahmednagar. Being young and enterprising, he suggested his father to add a new section of vegetarian bakery items which required an investment of ₹ 5 crores. His father Mr. Aariketh Acharya suggested him to take the decision with caution and understood everything comprehensively as bad decision may damage the financial fortune of business.
Identify the decision suggested by Mr. Aariketh Acharya. State by giving any three reasons as to why he must have advised his son to take decision with caution.
Which group consists of current assets?
What does the risk of capital budgeting decisions affect?
How does the Nature of Business affect fixed capital requirement?
How does fast obsolescence under Technology Upgradation affect fixed capital requirement?
What is the effect of higher expected growth on fixed capital?
How does Diversification affect fixed capital?
