Working Capital refers to the capital required for day-to-day operations of a business. It is the amount of money or resources that a company has readily available to fund its daily operations, cover its short-term liabilities, and invest in its ongoing projects. Working capital is essential for the smooth functioning of a business and helps in meeting its short-term financial obligations.

Raw materials and money in hand are both components of working capital. Raw materials are the basic materials used in the production process to create finished goods. These can include items such as metals, chemicals, textiles, or agricultural products, depending on the nature of the business. Having an adequate supply of raw materials is crucial for uninterrupted production and timely delivery of goods to customers.

Money in hand, on the other hand, refers to the cash or cash equivalents that a company possesses at a given point in time. It includes physical currency, as well as funds held in bank accounts or other liquid assets that can be readily converted into cash. Money in hand is necessary to meet various day-to-day expenses, such as paying wages to employees, purchasing supplies, and covering other operational costs.

Having both raw materials and money in hand ensures that a business can continue its operations smoothly without any disruptions. It allows the company to fulfill customer orders on time, maintain a steady production process, and meet its financial obligations.

In summary, working capital is the capital required for the day-to-day functioning of a business. It includes raw materials and money in hand, which are both essential for the smooth operation of a company. Raw materials are necessary for production, while money in hand is required to meet daily expenses and financial obligations.