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Working Capital Calculator
Check whether short-term assets cover short-term bills, using three common liquidity measures.
Working capital, current ratio and quick ratio from your balance sheet.
Free to run · to save projections to your live dashboard
Enter values and click Calculate to see results
Worked example
Calculated by the same engine as the calculator above.
- Inputs
- Current assets
- ₹40,00,000
- Inventory (part of current assets)
- ₹10,00,000
- Current liabilities
- ₹25,00,000
- Result
- Working capital
- ₹15,00,000
- Current ratio
- 1.6
- Quick ratio
- 1.2
Formula
Working capital = Current assets − Current liabilities
- Current assets = cash, receivables, inventory and other assets turning into cash within a year
- Current liabilities = payables, short-term loans and other bills due within a year
- Current ratio = Current assets ÷ Current liabilities
- Quick ratio = (Current assets − Inventory) ÷ Current liabilities
Assumptions
- Uses the balance-sheet figures you enter on a single date.
- Inventory is treated as part of current assets.
- Ratios are rounded to two decimal places.
- Current liabilities must be above zero for the ratios to be meaningful.
- Educational estimate only, not financial advice. Capitallytics does not execute transactions.
Working Capital Calculator FAQ
Answers about how this calculator works.
What is a good current ratio?
Above 1 means current assets cover current liabilities. Many businesses aim for 1.2 to 2, but it varies by industry.
Why is the quick ratio lower?
It leaves out inventory, which can take time to sell. It shows whether you could pay short-term bills without selling stock.
Can working capital be negative?
Yes, when current liabilities are larger than current assets. That can signal a cash squeeze, though some businesses with fast customer payments run that way.
How can I improve working capital?
Collect receivables sooner, hold less stock, or agree longer payment terms with suppliers.