To discuss: The possibility of having a negative net working capital and a negative net capital spending.
Introduction:
Net working capital: The difference between the current assets and current liabilities of the company is called as net working capital. The net working capital is positive if the company’s current assets are higher than its current liabilities. If the current liabilities of the company are higher than its current assets, then the net working capital is negative.
Net capital spending:It refers to the difference between the dollars spent on purchasing fixed assets and the dollars received from the sale of fixed assets.
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Corporate Finance: Core Principles and Applications (Mcgraw-hill Education Series in Finance, Insurance, and Real Estate)
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