When selling your business in the lower middle market (more than $2 million in enterprise value), the value is usually based on a financial calculation — a multiple of EBITDA (earnings before interest ...

Working capital is the amount of money a company has available in short-term liquid assets. It determines a company’s immediate liquidity and is often used to manage cash flow and for other forms of ...

Net working capital is positive if short-term assets exceed liabilities. Yearly net working capital change occurs from balance sheet variations. A significant increase in accounts payable can reduce ...

Rey Adams is an economist and writer. He has 15+ years of professional experience in investment management and consulting. David Kindness is a Certified Public Accountant (CPA) and an expert in the ...

Net working capital (“NWC”) is often a highly scrutinized component in M&A deals and can significantly impact the purchase price. NWC represents the liquidity a company needs to run its day-to-day ...

Working capital measures financial health by subtracting current liabilities from assets. A current ratio above 1 indicates adequate working capital, reflecting company stability. Excessive working ...

Working capital is a crucial ingredient to running a small business. It is the money a business has available to spend on its operations after paying off its bills and short-term debts. The working ...

Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor. Claire's expertise lies in corporate finance & accounting, mutual funds, ...

The extent to which an increase in revenue will affect your company's working capital depends on how efficiently your business operates. If your company is already profitable, then more revenue should ...