Measures how efficiently a company uses its working capital to generate sales.
What it Measures ?
How well we use our short-term funds to generate sales.
Relevant StakeHolders
CFO, Finance Manager
In-depth Use Case / Real-world Example
Working Capital Turnover is calculated by dividing net sales by average working capital. If a company has ₹1,000,000 in sales and ₹200,000 in working capital, the turnover ratio is 5. A high ratio indicates efficient use of working capital, while a low ratio suggests inefficiency in asset utilization.
By using this website, you agree to the storing of cookies on your device to enhance site navigation, and analyze site usage. View our Privacy Policy for more information.