Cash Ratio Calculator


Cash Ratio Calculator is tool that finds out the ability to use cash and the cash equivalents. To pay its current liabilities, it is an indicator of company's short-term liquidity

Cash Ratio:
What does Cash Ratio mean?
Cash ratio is the ratio of cash and cash equivalents of a company to its current liabilities. It measures the ability of a business to repay current liabilities by only using the cash and cash equivalents.
Cash Ratio = Cash + Cash Equivalents/Current Liabilities

A company called ‘ZIMA’ has following assets and liabilities at the year ended December 31, 2017:-

Marketable Securities12,000
Accounts receivable$17,874
Accounts Receivable56,200
Prepaid Insurance9,000
Total Current Liabilities73,780

According to the formula, Cash Ratio is:-

  • = (34,390 + 12,000) / 73,780
  • = 46,390 / 73,780
  • = 0.63