Current Ratio Calculator
Calculate the current ratio from current assets and current liabilities. Get the ratio, working capital, a liquidity rating, and how it compares against typical current ratio ranges by industry.
Input
Cash, receivables, inventory, and other assets convertible to cash within a year.
Debts and obligations due within a year, from the balance sheet.
Output
| Metric | Value |
|---|---|
| No data yet | |
| Industry | Typical Current Ratio Range | Your Ratio |
|---|---|---|
| No data yet | ||
Guides
What is the current ratio?
The current ratio measures a company's ability to pay off its short-term obligations with its short-term assets. It's calculated as current assets ÷ current liabilities — a current ratio of 1.5 means a company has $1.50 of short-term assets for every $1.00 of short-term debt. It's the most widely used liquidity ratio for gauging near-term financial health.
How this tool works
- Enter current assets — cash, receivables, inventory, and other assets convertible to cash within a year, from the balance sheet.
- Enter current liabilities — debts and obligations due within a year, also from the balance sheet.
- Choose a currency for the formatted output.
The Current Ratio Summary shows current assets, current liabilities, the current ratio, working capital (the dollar-amount view of the same two inputs), and a liquidity rating. The Industry Benchmark Comparison shows how your ratio stacks up against typical current ratio ranges for five common industries.
Why industry context matters
A "good" current ratio isn't one fixed number — it depends heavily on the business. A utility or subscription business with predictable, recurring cash flow can operate safely below 1.0, while a retailer holding seasonal inventory typically needs 1.0–1.5 to stay solvent through slow periods. The benchmark table shows where your ratio falls relative to five commonly-cited industry ranges, rather than judging every company against the same generic scale.
These benchmark ranges are widely-published rules of thumb, not a guarantee — actual healthy ranges vary by company maturity, sub-sector, and accounting treatment. Always compare against direct competitors' actual ratios for a more precise read.
The formula
Current Ratio = Current Assets ÷ Current Liabilities. Working Capital = Current Assets − Current Liabilities — the same two balance-sheet figures expressed as a dollar amount instead of a ratio.
A current ratio below 1.0 means current liabilities exceed current assets (negative working capital), which can signal a near-term liquidity risk. A ratio much above 3.0 can mean too much capital is tied up in idle current assets instead of being reinvested.
Common uses
- Assessing whether a company can meet its short-term obligations
- Comparing a company's liquidity position against its industry norm
- Screening potential investments or loan applicants for liquidity risk
- Tracking how a company's working capital changes quarter over quarter
Privacy
This tool runs entirely in your browser. Your numbers are never uploaded to a server.
Use it from code
From 3 credits per callREST API
curl -X POST https://api.iotools.cloud/v1/tool/current-ratio-calculator \
-H "Authorization: Bearer YOUR_API_KEY" \
-H "Content-Type: application/json" \
-d '{
"currentAssets": "150000",
"currentLiabilities": "100000",
"currency": "USD"
}'Swap in your own key from your account. The tool's fields are the body — no wrapper.
Ask an AI agent
Use the IOTools `current-ratio-calculator` tool (Current Ratio Calculator) on this input:
YOUR_INPUT_HEREPaste this at any agent connected to the IOTools MCP server, then add your input.