Business
Working Capital Calculator
Measure whether you have enough short-term assets to cover short-term obligations.
Result
Receivables are counted at face value. In contracting, a large share of receivables sitting past 60 days makes the current ratio look far healthier than the bank balance feels.
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About this calculator
What is a healthy current ratio?
Somewhere between 1.5 and 3 is commonly cited. Below 1 means short-term obligations exceed short-term assets; far above 3 can mean cash sitting idle rather than being deployed.
Why does a profitable business run out of cash?
Because profit and cash are not the same. Paying for materials and labour weeks before the customer pays the invoice consumes working capital. Growth makes this worse, not better.
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