Working Capital is the difference between a business's Current Assets (cash, accounts receivable, inventory) and Current Liabilities (accounts payable, short-term debt, accrued expenses). The formula is simple: Working Capital = Current Assets - Current Liabilities. Positive working capital means the business can meet its short-term obligations. Negative working capital is usually a danger sign -- unless you are Amazon, which deliberately operates with a Cash Conversion Cycle of -30 days by collecting from customers instantly while paying suppliers in 60-90 days. Deloitte's 2025 report found approximately $1.8 trillion in working capital is trapped in the world's top 1000 companies. This guide covers definitions, formulas (Current Ratio, Quick Ratio, Cash Conversion Cycle), all components explained, three real-world examples, industry benchmarks, 10 management strategies, warning signs, and practical optimization techniques.