INTRODUCTIONWorking capital has been described as the lifeblood ofa business enterprise. It denotes the funds which arerequired for the day-to-day operations of the enterprise. Itrepresents the capital invested in current assets viz.,cash, receivables, and inventory. In many businessenterprises working capital forms, a substantial portion ofthe total capital employed. Fixed capital in the form ofproductive facilities cannot be utilized fully without anadequate supply of motive power i.e. working capital. Theamount of working capital in a business should be neithermore nor less than what is required. Inadequate workingcapital means a shortage of raw materials and other inputsresulting in underutilisation of machinery, ultimatelyleading to the failure of business and frustration ofobjectives through lack of funds.

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