What is net working capital?

Put simply, net working capital is your current assets minus your current liabilities.  So, what are current assets and what are current liabilities?  Your current assets are anything that you would expect to be convertible into cash within one operating cycle.  This means that they are cash, inventory, securities, prepaid expenses (like insurance or rent), accounts receivable, etc.  Your current liabilities are your debts and obligations that are due within one operating cycle.  This could be short-term notes, part of long-term notes, income tax, accounts payable, etc.

This means that your net working capital is what money you have left after you pay your bills.