Your ratio tells the story

Working capital is the amount you have remaining when current liabilities are subtracted from current assets. Whether a business has enough working capital is measured by the current ratio, or current assets divided by current liabilities. Generally, a current ratio of between 1.2 and 2 is considered the sign of a healthy business. If your current ratio is below 1.2, it's an indicator that your business might have difficulties paying its bills. If it is above 2, it's an indicator that your assets are not being put to their best use.

Disclaimer: The accuracy of these calculators and applicability to your circumstances is not guaranteed. Calculators are not a guarantee of credit. Results should be discussed with a qualified professional before any product purchases or loan commitments are made.

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