Divide current assets by current liabilities to test whether short-term obligations are covered.
The ratio divides one figure by the other and is read against a conventional benchmark of 2. Both the ratio and its percentage form are shown, because different audiences expect different presentations of the same number. A liquidity ratio compresses two absolute figures into one comparable number, which is what makes it usable across companies and periods of different size.
Current Ratio
Current Ratio = Current assets ÷ Current liabilities
Current Ratio = Current assets ÷ Current liabilities The ratio divides one figure by the other and is read against a conventional benchmark of 2. Both the ratio and its percentage form are shown, because different audiences expect different presentations of the same number.
A liquidity ratio compresses two absolute figures into one comparable number, which is what makes it usable across companies and periods of different size.
This calculator takes 2 inputs: Current assets, Current liabilities. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.