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b. Any usage prive which is from profits on a proprietorship or partnership. c. Loss of business or loss incidental which is required cash expulsion.
d. Establishment of a fund for a specific purpose such as pension funds, bond debts payment, which had matured, the replacement of non-current assets.
e. Additional purchases of fixed assets, intangible assets, and long-term investments.
5. Types of Working Capital
According to Sjahrial 2007: 104, working capital can be divided into two types, is :
a. Permanent Working Capital Permanent working capital is working capital that run the daily
company operations. Without a working capital has resulted in the operation will be stop. Working capital divided by:
1. Primary working capital The primary working capital is the minimum amount of working
capital that should be by company to ensure business continuity. 2. Normal working capital
Normal working capital is required to meet a necessary fit of production capacity dynamically.
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b. Variable Working Capital Variable working capital is using and always changing according to
circumstances. The changes are due to seasonal fluctuations, fluctuations conjuncture, and changes the nature of the emergency, so the variable working
capital divided into: 1. Seasonal Working capital
Seasonal working capital is the amount of funds which is required to anticipate when there are fluctuations in the activities of company.
2. Working capital cycle Working capital cycle is the amount of working capital which is
their necessary influences by the conjuncture. 3. Emergency working capital
Emergency working capital is the amount of working capital needs which is influenced by the circumstances that happen beyond the
capabilities of the company.
6. Definition of working capital management
According to Wes ton and Copeland 1999: 327 “Working capital
management is activities that cover all the management functions of current assets and current liabilities which is included in the company in order to
finance spending to daily operations.
