Final answer:
Net working capital is the amount of money that a company can use for day-to-day operations. It is calculated by subtracting current liabilities from current assets.
Step-by-step explanation:
Net working capital is the difference between a company's current assets and its current liabilities. It represents the amount of money that a company can use for day-to-day operations.
In simple terms, the net working capital is the amount of money the company has available to meet its short-term financial obligations. It can be calculated by subtracting current liabilities from current assets.
For example, if a company has $100,000 in current assets and $80,000 in current liabilities, the net working capital would be $20,000.