Working capital management
Free IMA CMA Part 2 (Strategic Financial Management) lesson in Corporate Finance. 8 min read, ~1,273 words.
Working capital = current assets. Net working capital = CA − CL. Three cash motives: transaction, precautionary, speculative. Lockbox is profitable when float-saving interest fees. EOQ = √(2DO/C); JIT pushes orders small and frequent. Maturity matching: permanent CA funded long, seasonal CA funded short.
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- 2B4
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