Current ratio calculator
A core liquidity ratio that banks and investors ask for: how many times current assets cover liabilities due within a year.
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How to use it
- Enter current assets and current liabilities.
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
Current ratio = current assets ÷ current liabilities. Working capital = current assets − current liabilities.
Example
Inputs: Current assets = 250,000, Current liabilities = 125,000. Result: Current ratio: 2 times; Reading: Current assets cover current liabilities; Working capital: 125,000.00.
Limits and caveats
- A healthy level varies a lot by industry; retailers usually run lower ratios than manufacturers.
- It treats cash and slow-moving inventory alike, so pair it with the quick ratio.
Questions about this tool
What does a current ratio of 2 mean?
The company has 2 of current assets for every 1 of liabilities due within a year.
Is a very high ratio always good?
Not always; it can mean idle cash or inventory piling up.
What counts as current assets?
Cash, receivables, inventory, prepaid expenses and anything else that turns into cash within a year.