What is the difference between working capital and fixed capital, and how do they impact a company's financial health?

Working capital refers to the funds a company uses for its day-to-day operations, such as paying bills and buying inventory. Fixed capital, on the other hand, is used for long-term investments like equipment and buildings.

Having sufficient working capital is crucial for a company's financial health as it ensures smooth operations and liquidity. On the other hand, fixed capital investments can impact a company's long-term growth and profitability. Balancing both types of capital is essential for a company to maintain financial stability and support its growth.