Working Capital

The money available for a business's day-to-day operations, calculated as current assets minus current liabilities. Example: A Gikomba wholesaler has KES 1,200,000 in inventory and cash but owes suppliers KES 800,000 due within 30 days. Her working capital is KES 400,000. By leasing her delivery van instead of buying it, she avoided tying up KES 1,500,000 in a single asset and kept her working capital healthy.