Lecture 2: What is working capital and Why working capital is required (Part-2)

[@sriharsha5247]

No words. How well this is explained

[@AnkushJain]

Thank you

[@krishnapandey3088]

Today i have started with this series...ur videos are always insightful. Eager to complete the series..

[@AnkushJain]

Thank you

[@bablakirti]

Excellent Sir Big fan

[@AnkushJain]

Thank you

[@mayurnagpal3744]

Awesome.i have understood in simple terms of working capital requirement.

[@AnkushJain]

Your welcome

[@NEHASHARMA-zr8tj]

Just completed lec 1.... Will complete the series

[@AnkushJain]

👍

[@amankumargupta133]

Very well explained and Full of Practical application..

[@AnkushJain]

Thank you

[@VijayPatil-ji6dc]

thank you for valuable content

[@AnkushJain]

Your welcome

[@amolshukla5397]

Easy to understand Thanks Boss

[@AnkushJain]

Your welcome

[@abhinavvishal326]

Very helpful video sir.

[@AnkushJain]

Thank you

[@maajisha03760376]

Well explained in simple language 👍👍👍

[@AnkushJain]

Thank you

[@rushabhshah6280]

thank you very much for this video

[@AnkushJain]

Your welcome 👍

[@saranyadevarajan1367]

Grateful

[@AnkushJain]

Thank you

[@Mukesh.talekar]

Thanks sir ,

[@AnkushJain]

Your welcome

[@Himanshu-bn9lw]

excellent

[@AnkushJain]

Thank you

[@jatinderkumar3286]

Best

[@AnkushJain]

Thank you jatinder

[@anmoladwani2530]

Sir, Fixed asset se sale of property adjust ni hua and same in T2 of jewellery what is adjustment?

[@AnkushJain]

Can you elaborate it more?

[@satwikarora8009]

When Mr. A, buys inventory worth 7 lac, this time he will be having existing customer base. So why will he wait for 30 days. He can sell at t=0 this time. Kindly clarify.

[@AnkushJain]

His customers take 30 days time for repayment. This is not in his control. Having a customer is separate thing but a customer having immediate money to pay is separate thing

[@RajanKumar-gh2qx]

Sir in this case if the borrower has already invested Rs 24 as Capital and after 90 days there js no gap as such as the cycle is now managed by own fund. If the same client now asks for WC should we fund him as there is no gap as such?

[@AnkushJain]

Yes as first of all gap remains same practically as terms keep on changing. Secondly for expansion of business client would need additional funds. That is why we link enhancement with additional sales

[@RajanKumar-gh2qx]

@@AnkushJain But sir after the completion of first cycle, i.e. receiving payment of first sale the cycle shall be streamlined by virtue of own fund...so is it technically a Gap...Rs 16 is the WC required at all the time and that is met by the promoter's own fund...for expansion I understand that additional funds shall be required but for same level is additional funds needed? Does it imply that if bank funds Rs 16 then the gap of 60 days shall be bridge with 0 days gap and the same fund can be used by business to buy additional stock, pay upfront to suppliers to get better cost etc etc.

[@AnkushJain]

Yes simple hai na.. agar client ka business model mein koi cycle change nhi hua ya fir client ka turnover ka expansion plan nhi hai then fir hum additional paise dete hi nhi hai kbhi bhi

[@deepakporwal446]

👍

[@AnkushJain]

Thank you

[@kimtonsing1067]

🔥🔥👍👍

[@AnkushJain]

Thank you 👍

[@kailashverma6566]

Sir , how we check working capital cycle in food manufacturing company Where raw material finished good material self life is very low and second thing they use no.rs of raw material and from this they make nors of finished good And they sell most of the items on counter and some direct to vendor So, difficult to identify holding period of raw material and finished good

[@AnkushJain]

Usually they store raw material in specialized cold storages etc. But none the less their inventory is not much higher. The profile mentioned by you above who sells over the counter for cash does not have much high working capital requirement

[@kailashverma6566]

@@AnkushJain thq sir for clearing my doubt 😊😊

[@AnkushJain]

👍

[@TheSuresh2022]

Sir, operating income and total sales same hote h??

[@AnkushJain]

No they both are different. Pl watch videos of cma and financial statement analysis. You will get clarity

[@prakashpareek2762]

Very knowledgeable session sir. Thank you very much for uploading this video on KZbin.

[@AnkushJain]

Thank you👍

[@praveensharma3800]

Very smart.

[@AnkushJain]

Thank you

[@stayinpresent-]

But sir if Mr A sold 7 lakh of stock also he earned some profit you not add it

[@AnkushJain]

@@stayinpresent- I have assumed nil profit or loss for simplicity of calculation and understanding the concept

[@rajurajeshkumar9177]

Sir working capital ka course karna hai

[@AnkushJain]

This course is working capital course only. Start from lecture no. 1 and keep on following the series in sequence

[@saranyadevarajan1367]

The content was very useful.. thanks for the subtitles in English sir

[@meenabhardwaj6952]

Sir i am pursuing cs course.and done my graduation..am i eligible for this course?

[@AnkushJain]

Yes but credit manager profile only after completing CS

[@ankitgupta5583]

What is deferred tax??

[@AnkushJain]

Pl refer attached link to read about it cleartax.in/s/deferred-tax-asset-deferred-tax-liability-dta-dtl

[@ankitgupta5583]

@@AnkushJain sir sometimes it is quite possible that working capital gap may be negative due to current liabilities more..in this scenario we should fund to company or not..if working capital negative it's showing negative of company financial position..

[@AnkushJain]

Yes we can fund in other forms like OD, DLOD, LAP, WCTL with sufficient collateral or we can ask promoter to introduce capital in order to maintain adequate gap

[@RajanKumar-gh2qx]

Sir please make a video on assessment for a case with actual Balance Sheet. As here the client is working on break even, in the real time assessment understanding the calculation shall be somewhat different.

[@AnkushJain]

Pl check cma related videos, i have used balance sheet in that

[@mohankumhar1199]

Profit q nhi add kiye

[@AnkushJain]

Example ki simplicity k liye assume kia k profit zero hain.. just concept samjhane k liye

[@ajknowledgepark7709]

Please tell me sir..... In simple words how can we define working capital.............

[@AnkushJain]

Funds used for managing day to day operations of the business

[@yjgratitude5]

Thank you sir

[@AnkushJain]

Your welcome