Balance sheet of ABC ltd as on March 31 2022.

Net working capital of ABC its is.

10000

The correct answer is option (2) - 10000

Gross working capital (also known as current capital or circulating capital) is the sum total of all current assets of the business.

Net Working Capital means Current assets- Current Liabilities

Current assets include cash, inventory (raw materials, work in process, finished goods, spares etc) and accounts receivable (or trade debtors). Current assets comprise items that would get converted in to cash in the short-run, say, within the normal operating cycle (or cash conversion cycle) of the business.

Current liabilities represent short-term source of funds and are expected to fall due or mature for payment in a short period, generally within a year. These typically consist of payables to vendors and service providers, employees, other short term borrowings and provisions.

In the present case, Current Assets are as follows:

Debtors:Rs 8,000

Short term Investment: 5000

Cash: Rs 6,000

Bank: Rs 3,000

Current Liabilities are as Follows:

Creditors: Rs 5,000

Bank Overdraft: Rs 4,000

Short term loan: Rs 3,000

Thus,

Current Assets= 8,000+5,000+6,000+3,000= Rs 22,000

Current liabilities = 5,000+4,000+3,000 -= Rs 12,000

Net Working Capital= Current assets- Current Liabilities

                                = Rs22,000 - 12,000

                                =10,000