share holder's equity and net working capital

[hw0799]

what is average net working capital? when it appear in the question, and the question ask us to calculate E/P, we should not use it ?
what is the difference between: share holder’s equity and equity, working capital. are they all the same?
Thanks.

 

[Super I]

Is equity the same as working capital? These are Accounting 101 questions. You need to crack a book instead of posting these questions here. I hope you’re not taking the exam this weekend.

 

[smeet]

Equity = Assets - liabilites
NWC= current assets - current liabilities
shareholders equity = equity - preferred shareholders equity

 

[zeroaffinity]

> what is the difference between: share holder’s equity and equity, working capital. are they all the same?
No, they’re not all the same.
* Working capital is current assets - current liabilities (net).
* Equity is, um, Assets - Liabilities. Also known as Net Assets and occasionally stockholders’ equity or book value of equity.
The only thing I can think of related to E/P (P/E) requiring WC is a FCFE or OFCF calculation, both of which require you to pull out the change in WC.
HTH

 

[Super I]

smeet Wrote:
——————————————————-
> shareholders equity = equity - preferred
> shareholders equity
No. Look at any real company’s balance sheet and you’ll see that the caption Shareholder’s (or stockholder’s) Equity includes preferred stock.
Shareholders equity - preferred equity = common (shareholders’ ) equity