Working Capital Ratio Analysis

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INTRODUCTION Working capital is called as the nerve system of any business. Without efficient working capital management company cannot attain its objectives and not possible to maintain financial soundness. So in this perspective present study is undertaken to study the working capital management through ratio analysis at CHLOROPLAST. The term working capital refers to the management of current assets. It is the part of total capital used for carrying out the routine or regular business operation. In simple words it is the amount of funds used for financing the day to day operation. In short, it is the capital with which the organization is worked over. Thus, working capital consist of capital invested and locked up…show more content…
To find out the cash conversion cycle. To evaluate the profitability and overall performance of the organization. To analyze the impact of working capital on firm’s profitability. METHODOLOGY OF THE STUDY Sources Of Data Primary Data Information gathered by discussions with finance department head and project guide. Secondary Data Company website Brochures and materials issued by the organization. Audited accounting reports Tools used for the analysis Ratio analysis A ratio is a statistical tool which provides a measure of the relationship between two or more variables or figures. This relationship can be expressed as a percent or as a quotient.…show more content…
LITERATURE REVIEW Strategies for improving working capital management by Dorothy Rule, Director and Global Head of Liquidity and Investment, Citigroup Global Transaction Survives: This article explains the importance of information integration & the need for liquidity management in organizations. The article also deals with the contrasting approaches to maximizing liquidity like Asian subsidiaries funding each other, concentrating funs worldwide and global treasury or moving excess balances directly to global treasury. Trends in Working Capital Management and its Impact on Firm’s performance by Kesseven Padachi: This paper discusses about the trend in working capital needs and profitability of firms to identify the causes for any significant difference between the industries. The dependent variable, return on total assets is used as a measure of profitability and the relation between working capital management & corporate profitability is found out for a sample of 58 small manufacturing

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