Fill in the Blanks
Multiple Choice Question:
Funds required for purchasing current assets is an example of ______
Fixed capital requirement
Ploughing back of profits
Working capital requirement
Current assets are generally used for the day-to-day operations of a business. The funds that a company requires for undertaking day-to-day operations, such as the purchase of raw materials and payment of wages and salaries, are part of its working capital requirements. Thus, the funds that a firm requires for purchasing current assets are part of its working capital requirements.
Hence, the correct answer is option Working capital requirement.
Concept: Meaning and Nature of Business Finance
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