Case 8-17 Working Capital and Inventory Management

Proper working capital management and inventory management are important for successful companies.

Required:

Define working capital management.

What are the internal and external factors affecting a companys working capital needs?

Assessing a companys liquidity is an important aspect of working capital management. What ratios are available to assist in this process?

Inventory management is a key aspect of working capital management. What is the objective of inventory management?

What are the motives for holding inventory?

What are the approaches to managing inventory levels?