Net Working Capital Ratio Calculator - Glossary:Using our net working capital ratio calculator, helps to compare, measure, understand the overall health of the business.
Net Working Capital Ratio:Shows the proportion of short term net funds to assets. In simple words, it is a measure to know, if a company is gradually shifting more of its assets into or out of long-term assets.
How to calculate?Formula: Net Working Capital Ratio = Net Working Capital/Total Assets
This is a Balance Sheet component, the values are commonly stated against Current Assets, Current Liabilities and Total Assets.
Net Working Capital = total current assets - total current liabilities.
It is a liquidity calculation that measures a company’s ability to pay off its current liabilities with current assets.