Liquidity Ratios Calculator (Current, Quick and Cash Ratio)

What this tool does

The three ratios ask the same question with a tougher test each time: can the business pay what it owes within a year? The current ratio uses all current assets, the quick ratio takes stock out because it can be slow to sell, and the cash ratio counts only cash. Below 1 the short-term debts exceed the short-term assets; what counts as healthy varies a lot by sector (a supermarket and a shipyard are very different), so compare with similar companies and with the company's own past. Some analysts use cash plus receivables for the quick ratio instead of subtracting stock; this tool uses (current assets − inventory).

Formula

current = current assets ÷ current liabilities · quick = (current assets − inventory) ÷ current liabilities · cash = cash ÷ current liabilities

Variables

Worked example

Limitations

• This is an informational calculator, not personalised financial advice. Rates, fees, taxes and contract conditions vary between institutions and countries.
• The tool works with whatever currency you use for the inputs; it does not convert between currencies.