Trade Working Capital

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DEFINITION of 'Trade Working Capital'

The difference between current assets and current liabilities directly associated with everyday business operations.

BREAKING DOWN 'Trade Working Capital'

This measure is relevant in analyzing the near-term financial health of a company, as only current assets and current liabilities used for everyday business are considered.

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RELATED FAQS
  1. How do you calculate working capital?

    The formula for calculating working capital is straightforward, but lends great insight into the shorter-term health of a ... Read Answer >>
  2. What is the difference between an expense and a liability?

    Learn what liabilities and expenses are, which financial statements they are listed on, and the differences between liabilities ... Read Answer >>
  3. How can working capital affect a company's finances?

    Understand how working capital may affect a company's financial strength and investment effectiveness, as it changes from ... Read Answer >>
  4. Do working capital funds expire?

    Find out how and why a company's working capital can change over time, though the fund does not actually expire, and how ... Read Answer >>
  5. What are some examples of current liabilities?

    Examine some common examples of current liabilities a company may owe within a year or less in order to accurately assess ... Read Answer >>
  6. How do you calculate net current assets in Excel?

    Learn how to calculate net current assets, or working capital, in Microsoft Excel and how to evaluate the financial health ... Read Answer >>
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