Working capital dd2

Accounts Receivable management

He are going to manage the accounts Receivable with different schemes. It is also called "paysales outstanding"

Factoring

Selling A/R or invoice to financial institutions or banks. The bank are taken responsibility are take risk also. Then they are taken commission..

What Is gross working capital?

The amount invested in current assets is called gross working capital

What is temporary working capital?

The capital fund is raised form short term capital and also taken from short term capital form outside. Ex: bank credit, commercial papers.

What is permently working capital?

The capital which is raised or taken from long-term capital for working capital permanent working capital Ex: long liability +owners equity

What is working capital?

The capital which is used for working activities & operations is called working capital

Cash management policy /investment management policy.

Certificate of deposits Commercial papers with high credit rating Bonds - which is having high credit rate the company mange the excess of cash is invested into different types of securities etc.

What is net working capital?

Net working capital =current assets - current liabilities

Net Operating cycle

The Times company takes between the date on which company pays for its inventory and the day on which company collects it's Receivables Net Operating cycle = Inventory Days + Receivable Day's - Payable day's

Operating Cycle

The duration between the day on which company receives it's inventory to the day on which company collects it's Receivable is called as "operating cycle" Operating cycle =inventory days +Receivable Days

Bridge finance

The purpose of long-term capital before we have to take short term loan.. Ex: shares bonds

Line of credit

To extend the credit limit and credit period..

Accounts Payable management

We have to manage the A/P payables of the company and also to manage the payables of the company...

Inventory management

We have to manage the inventory cost of control the cost to the company. EOQ JIT ABC....

Inventory financing?

Extending finance to the company against a inventory as a security is called as "inventory financing" Ex : warehouse financing

Forefating

Whenever the invoices send/export to the other F. I is called forfating.