Working Capital Calculator
Assess your business liquidity with working capital and current ratio.
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Working Capital Calculator
Use the formula and worked example below to calculate manually.
Overview
Working capital measures a business's short-term liquidity — its ability to meet day-to-day financial obligations. This calculator computes net working capital and the current ratio from your current assets and current liabilities.
How to use this calculator
- Enter total current assets (cash, accounts receivable, inventory).
- Enter total current liabilities (accounts payable, short-term loans, accrued expenses).
- The calculator shows net working capital and the current ratio.
Understanding the inputs & results
Current assets
Assets expected to be converted to cash within one year — cash, debtors, inventory.
Current liabilities
Obligations due within one year — trade payables, short-term loans, GST dues.
Net working capital
Current assets minus current liabilities. Positive = healthy; Negative = liquidity risk.
Current ratio
Current assets / Current liabilities. A ratio above 1 means assets exceed liabilities; 1.5–2.0 is generally healthy.
Quick ratio
(Current assets − Inventory) / Current liabilities. A stricter liquidity measure excluding illiquid inventory.
The formula
Working capital metrics
NWC = Current Assets − Current Liabilities | Current Ratio = Current Assets / Current Liabilities
NWC shows the buffer available after meeting short-term obligations. The current ratio normalises it for comparison across businesses of different sizes.
Worked example
Current assets ₹50L, Current liabilities ₹30L.
- NWC = 50L − 30L = ₹20L.
- Current ratio = 50 / 30 = 1.67.
✓ Net working capital = ₹20L. Current ratio = 1.67 (healthy).
Frequently asked questions
Working capital analysis should be used alongside cash flow statements and industry benchmarks for a complete picture of financial health.