Working Capital Calculator
Net working capital requirements and health check.
Working capital = Current assets − Current liabilities. It's the capital available for day-to-day operations. Positive WC means you can cover short-term obligations. Negative WC can signal liquidity risk. This calculator helps you assess working capital and the current ratio (assets/liabilities).
Inputs
Results
Working capital: $30,000
Current ratio: 1.67
Health: Healthy
Insights
Formula
WC = Current assets - Current liabilities Current ratio = Assets / Liabilities (target > 1.5)
Input Definitions
What does each input mean?
- Current assets
- Cash, accounts receivable, inventory, and other assets convertible to cash within 12 months.
- Current liabilities
- Accounts payable, short-term debt, accrued expenses, and obligations due within 12 months.
Related Calculators
The Number That Determines Whether Growth Helps or Hurts You
Working capital — current assets minus current liabilities — is the measure of a business’s short-term financial health and operational liquidity. Positive working capital means you can meet near-term obligations; negative working capital means growth can actually make your cash position worse because you need more cash to fund operations than you’re collecting. This calculator helps you see your working capital position clearly.
It’s most useful when you’re evaluating a significant growth opportunity and want to understand the cash requirement, when you’re preparing financial statements for a lender or investor, or when you want to monitor operational health on a monthly basis. Many businesses experience working capital problems precisely when they’re growing fastest — understanding this dynamic before it happens is how you avoid a growth-driven cash crisis.