Fundamentals of Corporate Finance (4th Edition) (Berk, DeMarzo & Harford, The Corporate Finance Series)
Fundamentals of Corporate Finance (4th Edition) (Berk, DeMarzo & Harford, The Corporate Finance Series)
4th Edition
ISBN: 9780134475561
Author: Jonathan Berk, Peter DeMarzo, Jarrad Harford
Publisher: PEARSON
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Chapter 20, Problem 5CT
Summary Introduction

Permanent working capital: Permanent working capital is the minimum amount that must be keep invested in the short-term current assets by the business to carry out the minimum level of activities. Permanent working capital is also called minimum working capital.

Temporary working capital: The amount of working capital which is required by the business over and above permanent working capital is the temporary working capital. It is also called as net working capital.

To identify:

The difference between permanent and temporary working capital.

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Working capital explained; Author: The Finance Storyteller;https://www.youtube.com/watch?v=XvHAlui-Bno;License: Standard Youtube License