aliya bhat
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Hi Can you please Explain the role of ‘Operational efficiency’ in the determination of working capital requirement?
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Pankaj
answered
Hello
The firm with a better operational efficiency has to invest less in working
capital because they convert raw materials quickly into finished goods, and sell them at their
earliest. i.e.
a) converts stock into sales quickly.
b) Promptly collects debts from debtors and bills receivable
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Chirag
answered
The firm with a better operational efficiency has to invest less in working
capital because they convert raw materials quickly into finished goods, and sell them at their
earliest. i.e.
a) converts stock into sales quickly.
b) Promptly collects debts from debtors and bills receivable
