Enter the current assets and current liabilities into the calculator to determine the working capital ratio of a business.

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## Working Capital Ratio Formula

The following formula is used to calculate a working capital ratio.

WCR = A / L

- Where WCR is the working capital ratio
- A is the total assets ($)
- L is the total liabilities ($)

## Working Capital Ratio Definition

A working capital ratio is a ratio of the value of all assets to all liabilities of a business. It’s one measure used to determine the profitability and position of a company.

## Working Capital Ratio Example

How to calculate a working capital ratio?

**First, determine the total asset value.**Measure the value of all assets owned by the business.

**Next, determine the total liabilities value.**Measure the total value of all liabilities owned by the business.

**Finally, calculate the working capital ratio.**Calculate the working capital ratio using the equation above.

## FAQ

**What is working capital ratio?**

A working capital ratio is a measure of how much capital a company has to use with respect to liabilities. The greater the ratio, the greater the position of the company.

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