One possible definition of net working capital (NWC)provided by your authors is:
A)NWC = A/R + inventory - A/P.
B)NWC = cash + A/P - inventory.
C)NWC = A/P + A/R - short-term loans.
D)NWC = A/R + inventory - long-term debt.

Question

Quizplus · Accepted Answer

The formula provided in choice A is the correct formula for calculating net working capital, which is the difference between a company's current assets and its current liabilities. Specifically, it is calculated by subtracting accounts payable (A/P) from the sum of accounts receivable (A/R) and inventory. This formula reflects the amount of cash a company has available to fund its daily operations.

One Possible Definition of Net Working Capital (NWC)provided by Your