1) A. Which of the two definitions of Working Capital is more intuitive?

a. Current Assets - Current Liabilities, because current means for working.

b. LT Debt + Equity - FA because it takes into account the FA.

c. LT Debt + Equity - FA, because the definition CA - CL makes you think it is an asset, when in fact its a liability, a source of capital.

d. CA - CL, because its simpler.

B. If sales are 200 and NFO is 5% of sales, and payables is 30 and inventory 20, then days of receivables is:

a. 65 days

b. 90 days

c. 36 days

d. 25 days