The correct answer is: C. On decrease in movable assets
Working capital is the difference between a company’s current assets and its current liabilities. It is a measure of a company’s liquidity and ability to meet its short-term obligations.
Current assets are assets that are expected to be converted into cash or used up within one year. Examples of current assets include cash, accounts receivable, inventory, and short-term investments.
Current liabilities are liabilities that are due within one year. Examples of current liabilities include accounts payable, short-term notes payable, and accrued expenses.
Working capital can be increased by increasing current assets or decreasing current liabilities. However, working capital will decrease if current assets decrease or current liabilities increase.
Option A is incorrect because increasing movable assets will increase working capital.
Option B is incorrect because decreasing movable liabilities will increase working capital.
Option C is correct because decreasing movable assets will decrease working capital.
Option D is incorrect because all of the options are possible ways to increase or decrease working capital.