What is the Current Ratio Calculator?

The Current Ratio Calculator is a financial tool that helps businesses, accountants, and analysts evaluate a company’s short-term financial health. By entering current assets and current liabilities, the calculator determines the current ratio, which measures the company’s ability to cover its short-term obligations with its short-term assets. This helps users understand liquidity levels and make informed decisions regarding cash flow management.

How to Use:

1. Enter Current Assets (PKR): Input all assets that can be converted to cash within a year, such as cash, receivables, and inventory.
2. Enter Current Liabilities (PKR): Input all short-term obligations due within a year.
3. Click “Calculate”: The calculator computes the current ratio and assigns a liquidity status.
4. Review Result: The output displays current assets, liabilities, the current ratio, liquidity status (Excellent, Good, Fair, Poor), and the formula: Current Ratio = Current Assets ÷ Current Liabilities.