Question

Importance of working capital management

Answer 1

The goal of working capital management is to ensure that a firm is able to continue its operations and that it has sufficient ability to satisfy both maturing short-term debt and upcoming operational expenses. Themanagement of working capitalinvolves managing inventories, accounts receivable and payable, and cash.

Answer 2

The Importance of Working Capital Management. ... Thus, it is vital to all businesses to have adequatemanagement of working capital. Working capital management is essentially an accounting strategy with a focus on the maintenance of a sufficient balance between a company's current assets and liabilities.