HesapHanem

Working Capital Calculator

Find your working capital and current ratio.

How it is calculated

Working capital measures short-term financial room: working capital = current assets − current liabilities. The tool also gives the current ratio, current assets ÷ current liabilities, shown with two decimals. Use only items that are cash or expected to turn into cash within a year (cash, receivables, inventory) against obligations due within the same period (payables, short-term debt, accrued expenses). A positive result means short-term assets cover short-term debts, and a ratio above 1 says the same thing relative to size. If liabilities are zero, the ratio cannot be computed and a dash is shown. A negative working capital is allowed and shows a shortfall.

Worked example

A company has current assets of $250,000 and current liabilities of $160,000. Working capital: 250,000 − 160,000 = $90,000.00. Current ratio: 250,000 / 160,000 = 1.5625, shown as 1.56. In plain terms, the company holds $1.56 of short-term assets for every $1 it owes within the year, and has $90,000 of cushion left over once those debts are paid.

Try this example →

Common mistakes

  • Including long-term assets such as buildings or equipment in current assets.
  • Counting long-term debt that is not due within a year as a current liability.
  • Swapping the two inputs, which turns a healthy positive figure into a negative one.
  • Judging the ratio on its own: a high figure can mean idle cash or slow-moving inventory, not only strength.

Sources

About this calculator

This calculator subtracts current liabilities from current assets to find working capital (the part of current assets — cash, receivables and inventory — left over once short-term obligations are covered; it is not the same as cash), and divides current assets by current liabilities to find the current ratio — a ratio above 1.0 generally means a company can cover its short-term obligations, while a ratio well below 1.0 signals a potential liquidity problem.

Small business owners checking whether they can cover payroll and supplier payments over the next few months, accountants preparing financial statements, and lenders or investors assessing a company's short-term financial health before extending credit all use these two figures together, since working capital shows the absolute short-term cushion while the current ratio shows it relative to the size of the business.

Was this helpful?

You can pick up to 3 reactions.

Comments (1)

  • Editorial team

    For a stricter view, run the tool a second time with inventory subtracted from your current assets. The ratio then shows how well cash and receivables alone cover short-term debts, since stock can take months to sell. A negative figure is not always a crisis, though; some businesses are paid by customers before they pay suppliers. How do you treat inventory when you assess your own business?

Popular calculators

Loan Calculator

Monthly payment, total interest and full amortization schedule.

Percentage Calculator

Percent change, percent of, and ratio calculations.

Discount Calculator

Calculate final price, savings, and discount amount.

BMI Calculator

Body mass index from height and weight (metric or imperial).

Age Calculator

Compute your exact age in years, months and days from a birth date.

Compound Interest Calculator

Calculate the final amount and interest earned with compounding.

All Calculators