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Reddy

In: Business and Management

Submitted By reddy12
Words 422
Pages 2
daDSADASFC
Dangers of Inadequate Working Capital
The following are the dangers of inadequate working capital:
1. It stagnates growth. It becomes difficult for the firm to undertake profitable or the firm to undertake profitable of the firm to understand profitable projects for non-availability of working capital.
2. It becomes difficult to implement operating plans and achieve the firm’s target profit.
3. Operating inefficiencies creep in when it becomes difficult even to meet day-to-day commitments.
4. It leads to inefficient utilization of fixed assets. Thus, firm’s profitability would deteriorate.
5. It renders the firm to avail attractive credit opportunities etc.
6. Firm loses its reputation when it is not in a position to honor its short-term obligations. Therefore, firm should maintain the right amount of working capital on a continuous basis.

Prepare your recommendation on Agarwal Cast Company?
Dangers of Inadequate Working Capital
The following are the dangers of inadequate working capital:
1. It stagnates growth. It becomes difficult for the firm to undertake profitable or the firm to undertake profitable of the firm to understand profitable projects for non-availability of working capital.
2. It becomes difficult to implement operating plans and achieve the firm’s target profit.
3. Operating inefficiencies creep in when it becomes difficult even to meet day-to-day commitments.
4. It leads to inefficient utilization of fixed assets. Thus, firm’s profitability would deteriorate.
5. It renders the firm to avail attractive credit opportunities etc.
6. Firm loses its reputation when it is not in a position to honor its short-term obligations. Therefore, firm should maintain the right amount of working capital on a continuous basis.

Prepare your recommendation on Agarwal Cast Company?
Dangers of Inadequate Working Capital
The following…...

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