The Importance of Working Capital DQ

The Importance of Working Capital DQ - Explain the...

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Explain the importance of working capital as it relates to the budget process in 200 to 350 words. Address the  following questions in your explanation: 1. What are the potential implications if a business owner miscalculates the working capital projection?  There are several potential implications if a business owner miscalculates the working capital projection.  The most daunting implication of a faulty working capital amount is that the business may run out of  money to satisfy its obligations. Working capital is the amount of money remaining out of cash inflows  from operating activities, after a firm has paid its capital expenditures and cash dividends. If a firm ends  up in a position where it has exhausted its working capital, then it runs into some additional problems.
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This note was uploaded on 03/14/2012 for the course ACCOUTNING 550 taught by Professor Abner during the Spring '11 term at DeVry Houston.

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