Fixed Capital:
Fixed capital refers to the long-term investment made by a business in fixed assets that are used to generate income over an extended period. These assets are not meant for resale and are essential for the production process or the operation of the business. Fixed capital plays a crucial role in the productive capacity of a company and is needed to sustain its operations in the long run.

Key Points:
- Definition: Fixed capital refers to long-term investments in fixed assets that are used for business operations.
- Purpose: It is crucial for the productive capacity and sustainability of a business.
- Examples: Machinery, equipment, buildings, land, vehicles, etc.
- Longevity: Fixed capital assets are not meant for resale and are expected to be used for an extended period.
- Depreciation: These assets are subject to depreciation, reflecting their declining value over time.
- Importance: Fixed capital enhances a company's ability to generate income and maintain its operations.

Working Capital:
Working capital refers to the funds that are readily available to a business to meet its day-to-day operational expenses and short-term liabilities. It represents the difference between a company's current assets and current liabilities and is a measure of its liquidity and ability to meet short-term obligations. Working capital is essential for the smooth functioning of a business, as it ensures the availability of resources to cover immediate expenses and maintain ongoing operations.

Key Points:
- Definition: Working capital represents the funds available for day-to-day operations and meeting short-term obligations.
- Calculation: It is calculated by deducting current liabilities from current assets.
- Components: Current assets include cash, inventory, accounts receivable, while current liabilities encompass accounts payable, short-term loans, etc.
- Liquidity: Working capital is a measure of a company's liquidity and its ability to meet short-term financial obligations.
- Management: Effective management of working capital is crucial to ensure the smooth operation of a business and avoid cash flow issues.
- Optimization: Balancing working capital is essential to strike a balance between excess liquidity, which may result in idle funds, and insufficient liquidity, which can lead to financial difficulties.

In conclusion, fixed capital represents long-term investments in assets used for business operations, while working capital refers to the funds available for day-to-day operations and meeting short-term obligations. Both forms of capital are essential for the success and sustainability of a business, with fixed capital supporting long-term growth and working capital ensuring smooth operational functioning.

Fixed capital is that capital which has been using since many years. Ex- Tools

Working capital is that capital that is reqired at every stage of productio. Ex- Money