money spent for the day-to-day running of a business is called?
Answer Details
Money spent for the day-to-day running of a business is called working capital. Working capital represents the funds that a business needs to maintain its daily operations, such as paying for raw materials, salaries, rent, utilities, and other expenses.
Working capital is calculated by subtracting a business's current liabilities from its current assets. Current assets include cash, accounts receivable, and inventory, while current liabilities include accounts payable, short-term loans, and other debts that must be paid within one year.
Having sufficient working capital is crucial for a business to maintain its operations and meet its financial obligations. A shortage of working capital can lead to difficulties in paying bills and suppliers, resulting in disruptions to the business's operations.
Therefore, the correct answer is working capital.