Paper URL: https://www.ijtsrd.com/management/accounting-and-finance/45164/a-study-on-working-capital-management-of-bharathi-cement-corporation-ltd/n-deepika-aryan
Working capital is that amount of funds which is requiring carrying out the day to day transactions of an enterprise whether big or small. It may also regard as that position of an enterprise total capital which is employed in its short term operations those operations consist of primarily such items such as raw materials, semi finished goods, finished goods, sundry debtors, short term investments etc. Thus working capital also refers to all the short term assets known as current assets used in day to day operations of an organizations Working capital sometimes called as networking capital is represented by the excess of current assets over the current liabilities and identifies the relatively liquid portion of total enterprise capital which constitutes a margin of buffer for maturing obligations with in the ordinary operating cycle of the business. The accounting principles of board of the American institute of certified public accountants. The main objective of the working capital management is to evaluate the company inventory position to analyze the company current ratio and liquidity ratios to analyze the company gross working capital and networking capital position and to identify the growth of inventory and net sales of the company to analyze the company performance the main tools and techniques which are used in this analysis are bar diagram, tables, ratio analysis and working capital changes.
Inventory Management includes detail study about inventory, its importance and effectively it should be managed for smooth operations of business. Inventories are assets of the firm and require investment and hence involve the commitment of firm’s resources. Every firm is required to manage the inventories in such a way as to get the best returns. The objective of inventory management is to determine the optimum level of the inventory that is the level at which the interest of all the departments are taken care of. The inventory management seeks to maximize the wealth of the share holders by minimizing the cost of procuring and maintaining. The objective behind the inventory management is maintaining sufficient stock of raw materials ensuring continuous supply to production process for uninterrupted production schedule and minimizing the total annual cost of maintaining inventories. Inventories are assets of the firm and hence involve the commitment of firm’s resources managers must ensure that the firm maintains inventories at the correct level.
