# Working Capital Calculator

URL: https://speedycalculator.com/calculators/finance/working-capital/
Last updated: 2026-10-25

> The working capital calculator works out a company's working capital – current assets minus current liabilities – the current ratio, and the working capital as a share of revenue.

## Inputs

- Cash
- Accounts receivable
- Inventory
- Other current assets
- Accounts payable
- Short-term debt
- Other current liabilities
- Annual revenue

## Results

- Current assets
- Current liabilities
- Working capital
- Current ratio
- Working capital as a share of revenue

## Formula

```
Working capital = current assets − current liabilities
Current ratio = current assets ÷ current liabilities
```

## Explanation

Positive working capital means a company can cover its short-term obligations. Too much working capital may mean cash is tied up in inventory or receivables.

### How to use the Working Capital Calculator

- **Cash**
- **Accounts receivable**
- **Inventory**
- **Other current assets**
- **Accounts payable**
- **Short-term debt**
- **Other current liabilities**
- **Annual revenue**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter cash, receivables, inventory, other current assets, payables, short-term debt and other current liabilities.

### Tips

- Use consistent periods (a year or a quarter) for flow figures and period-end values for balances.
- Average opening and closing balances when a ratio mixes a flow with a stock.
- Benchmark against competitors in the same industry.
- Read the ratio together with others – profitability, liquidity and efficiency tell different stories.

### Common mistakes to avoid

- Using sales instead of cost of goods sold for inventory ratios.
- Mixing gross, operating and net profit.
- Ignoring one-off items that distort a single year.

### Inputs explained

FieldWhat to enterCashAmount in your currencyAccounts receivableAmount in your currencyInventoryAmount in your currencyOther current assetsAmount in your currencyAccounts payableAmount in your currencyShort-term debtAmount in your currencyOther current liabilitiesAmount in your currencyAnnual revenueAmount in your currency

### What each result means

- **Current assets** = [Cash] + [Accounts receivable] + [Inventory] + [Other current assets]
- **Current liabilities** = [Accounts payable] + [Short-term debt] + [Other current liabilities]
- **Working capital** = [Current assets] - [Current liabilities]
- **Current ratio** = [Current assets]÷[Current liabilities]
- **Working capital as a share of revenue** = [Working capital]÷[Annual revenue]×100

### Example values

How the main result changes when **Cash** changes and everything else stays at the example values above:

CashWorking capital75,000205,000112,500242,500150,000280,000187,500317,500225,000355,000300,000430,000

## Worked example

Inputs — Cash: $150,000; Accounts receivable: $220,000; Inventory: $180,000; Other current assets: $30,000; Accounts payable: $160,000; Short-term debt: $80,000; Other current liabilities: $60,000; Annual revenue: $2,000,000.

Results — Current assets = $580,000.00; Current liabilities = $300,000.00; **Working capital = $280,000.00**; Current ratio = 1.93; Working capital as a share of revenue = 14 %.

## FAQ

**What is working capital?**
Current assets minus current liabilities.

**Is negative working capital bad?**
Not always – some retailers operate with negative working capital.

**How can a company improve working capital?**
Collect receivables faster, cut inventory and extend payables.

**What formula does the Working Capital Calculator use?**
Working capital = current assets − current liabilities.


## Sources

- [Corporate Finance Institute – financial ratios](https://corporatefinanceinstitute.com/)