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Business & Accounting

Working Capital Calculator

Calculate net working capital from current assets and current liabilities, the working capital ratio and its share of revenue.

Your inputs

Results

Net working capital

$100,000.00

Current assets
$200,000.00
Current liabilities
$100,000.00
Working capital ratio
2

✓Exact calculation — rounded only for display

What this calculator does

Working capital is the cushion of short-term assets over short-term obligations that keeps a business running day to day.

Formula and method

Net working capital = current assets − current liabilities; Ratio = current assets ÷ current liabilities

Worked example

Calculated by this tool with its default inputs:

Inputs

  • Cash and equivalents: 50000 (any currency)
  • Accounts receivable: 80000 (any currency)
  • Inventory: 70000 (any currency)
  • Other current assets: 0 (any currency)
  • Accounts payable: 60000 (any currency)
  • Short-term debt: 30000 (any currency)
  • Accrued and other current liabilities: 10000 (any currency)
  • Annual revenue (optional): 0 (any currency)

Results

  • Net working capital: 100,000
  • Current assets: 200,000
  • Current liabilities: 100,000
  • Working capital ratio: 2

How to read the results

Negative working capital is not always bad (some retailers run it deliberately) but signals reliance on fast cash turnover.

Assumptions and limitations

  • Current means due or convertible within one year.

Financial results are estimates based on the inputs and assumptions shown. They are not financial advice; confirm figures with your lender, provider or a qualified adviser before making decisions.

Questions

Is more working capital always better?

Not necessarily — excessive inventory or receivables tie up cash that could be used elsewhere.

Methodology and verification

Result type
Exact mathematical calculation (rounded only for display)
Formula version
1.0
Automated verification
3 reference and validation test cases, checked against independently computed values. The site cannot be built if any of them fail.
Editorial review
Awaiting human editorial review. The explanation was drafted with AI assistance; the formula and examples are verified by the automated tests above.

Privacy

Everything you enter is calculated in this browser and is not sent to Numerith or anyone else. Inputs are added to a share link only if you choose to include them. Privacy policy