Choose whether the statement is true/false:

Working capital and fixed capital are the same terms.

see full answer

Your Exam Success, Personally Taken Care Of

1:1 expert mentors customize learning to your strength and weaknesses – so you score higher in school , IIT JEE and NEET entrance exams.

An Intiative by Sri Chaitanya

True

False

answer is B.

(Unlock A.I Detailed Solution for FREE)

Best Courses for You

JEE

NEET

Foundation JEE

Foundation NEET

CBSE

Detailed Solution

The above statement is false.
The fact is quite the opposite. Fixed capital is a genuine, tangible asset employed as a production tool and is either long-lasting or not ultimately used at one time. It is there for the long run and is also mandatory. It includes elements like tractors, machinery, buildings, computers, generators, etc. In contrast, working capital is the metric used to assess a company's functional efficiency and economic soundness. In other words, the assets can be converted into cash within a year, such as cash, debtors, inventories, etc. It includes raw materials and the money involved in production. Hence the correct statement would be, Working capital and fixed capital are not the same terms.

Watch 3-min video & get full concept clarity