Question

Fixed Capital Working Capital 

Answer 1

S.r	Fixed Capital	Working Capital
1	Meaning Fixed capital refers to any kind of physical capital. i.e. fixed assets.	Working capital refers to current assets minus current liabilities.
2	Nature It stays in business almost permanently i.e. for more than one accounting year.	Working capital is circulating capital.
3	Purpose It is not used up in the production of products but invested in fixed assets such as land, building, equipment, etc.	Working capital is invested in short term assets such as cash, account receivable, inventory, etc.
4	Sources The fixed capital fund can come from selling shares, debentures, long term loans, bonds, etc.	Working capital can be funded with short term loans, deposits, trade credit, etc.
5	Objective of investment The investor invests money in fixed capital hoping to make a future profit.	The investor invests money in working capital for getting immediate returns.
6	Risk Involved Investment in fixed capital implies a risk.	Investment in working capital is less risky.