Calculate working capital and current ratio from current assets and liabilities with trend analysis and benchmark comparisons.
This calculator takes the current assets and current liabilities you enter and returns two figures: working capital (assets minus liabilities) and the current ratio (assets divided by liabilities). Saved entries build a trend line over time, and results are compared against stored benchmark ranges by industry. The mistake most people make is reading a high current ratio as automatically healthy - a ratio inflated by slow-moving inventory or aging receivables can look fine on paper while actual cash on hand is tight.
A concrete input and expected output from the current implementation.
Input
Current assets: $250,000. Current liabilities: $150,000.
Expected output
Working capital: $100,000. Current ratio: 1.67
$250,000 minus $150,000 gives $100,000 of working capital; $250,000 divided by $150,000 gives a current ratio of 1.67, meaning current assets cover current liabilities about one and two-thirds times over.
The tool subtracts total current liabilities from total current assets to get working capital, and divides current assets by current liabilities to get the current ratio. Both calculations use the numbers you enter as-is - it doesn't classify balance sheet line items for you, so you need to enter only the current portions (due or convertible to cash within about 12 months) yourself.
When you save more than one entry, the tool charts working capital and current ratio over time, which can surface a slow liquidity decline before liabilities actually overtake assets. It also compares your ratio to a stored reference range for the industry category you select, so the comparison is only as meaningful as the category chosen.
Anything expected to convert to cash or come due within about 12 months (or one operating cycle if longer) - cash, receivables, and inventory on the asset side; accounts payable, short-term debt, and accrued expenses on the liability side. The calculator doesn't classify this for you, so pull figures from the current-asset and current-liability subtotals on your balance sheet, not the full totals.
There's no single correct number - a ratio near 2.0 is a commonly cited rule of thumb, but fast-turnover or capital-light businesses often run healthily below that, while capital-intensive ones may need more. The tool's benchmark comparison gives an industry-relative reference point, not a pass/fail threshold.
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