The working capital represents the amount of funds needed to keep a company running in order to satisfy demand at lowest point called as
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The working capital represents the amount of funds needed to keep a company running in order to satisfy demand at lowest point called as Permanent working capital.
Permanent working capital is the amount of funds which is needed to produce goods and services necessary to satisfy demand at any particular point.
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Permanent or fixed working capital is the minimum amount of funds that must be kept invested in the company to keep it running and to meet demand at the most lowest levels.
These funds are kept in form of stocks, cash or receivable amounts that are kept locked in. the drawing source of these funds are usually from long term sources.
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