Current Ratio Calculator
Calculate current ratio and quick ratio to assess business liquidity.
By Konstantin Iakovlev · Updated September 2026 · Source: SBA — Business Guide
Current Ratio
2.00
Strong
Working Capital
$250,000.00
Liquidity Analysis
| Current Assets | $500,000.00 |
| Current Liabilities | $250,000.00 |
| Current Ratio (Assets / Liabilities) | 2.00 |
| Rating | Strong |
| Working Capital | $250,000.00 |
Industry Benchmarks
Strong
> 2.0
Good
1.5 - 2.0
Adequate
1.0 - 1.5
Concerning
< 1.0
Use the Current Ratio Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
Short-term solvency comes down to a simple question: can the business cover what it owes in the near term with the assets it can readily convert to cash? Two figures answer it here, the Current Ratio and the Quick Ratio, and together they give a clearer picture of working capital and whether immediate obligations can be met.
To find the Current Ratio, divide Current Assets by Current Liabilities. The Quick Ratio, sometimes called the Acid-Test Ratio, tightens that view by stripping out inventory and prepaid expenses: subtract both from Current Assets, then divide by Current Liabilities. Because it ignores stock that may be hard to sell quickly and prepayments that will not come back as cash, it reflects liquidity that does not depend on moving inventory off the shelves.
Benchmarks are not universal. What counts as a healthy ratio for a retailer can look very different from the norm for a tech startup, so compare against peers in the same industry rather than a fixed target. Watch the quality of the assets behind the number as well: slow-moving inventory can prop up the Current Ratio and make liquidity look stronger than it really is.
Example: Tech Solutions Inc. Liquidity Check
- 1 Input the following balance-sheet figures for Tech Solutions Inc.: Current Assets = $1,500,000, Current Liabilities = $750,000, and, under the quick ratio inputs, Inventory = $300,000 with Prepaid Expenses left at 0.
- 2 Current Ratio = $1,500,000 / $750,000 = 2.0. Quick Ratio = ($1,500,000 - $300,000 - $0) / $750,000 = $1,200,000 / $750,000 = 1.6. Working Capital = $1,500,000 - $750,000 = $750,000.
- 3 The calculator shows a Current Ratio of 2.00 and a Quick Ratio of 1.60, both rated Strong, and working capital of $750,000.
- 4 A Current Ratio of 2.0 means the company has twice as many current assets as current liabilities, and the Quick Ratio of 1.6 shows it could cover its short-term debts even without selling inventory. This suggests Tech Solutions Inc. is well placed to meet its short-term obligations.
Source: SBA — Business Guide · Last updated: September 2026
Frequently Asked Questions
What is a good current ratio?
What is the difference between current ratio and quick ratio?
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