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Cash Coverage of Current Liabilities Calculator

Calculate the cash ratio using eligible cash and cash equivalents.

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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Edit a calculated value to solve backwards, or lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Cash and equivalents of 500 against current liabilities of 1,000 give a cash ratio of 0.5. That represents 50% coverage using the included balances.

Cash ratio = cash and eligible cash equivalents ÷ current liabilities

Worked example

Enter these known values and leave the other values blank.

Cash and cash equivalents
500 USD
Current liabilities
1000 USD
Cash ratio
0.5 x

Assumptions and limitations

  • Include only balances that qualify under the accounting policy used for the analysis. Avoid double-counting component balances already included in the total. Restricted funds and longer-term investments may need separate treatment.
  • Use consistent periods, currency and accounting definitions. The result follows the stated formula and the figures you supply.

Common questions

Should every deposit or investment be counted?

Include only balances that qualify under the accounting policy used for the analysis. Avoid double-counting component balances already included in the total. Restricted funds and longer-term investments may need separate treatment.

References

The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.

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