Cash Ratio Calculator
Test your business survivability with the Cash Ratio Calculator. Evaluate if your Cash and Equivalents cover your short-term liabilities. Free financial tool.
Cash Ratio Calculator
Test your business survivability with the Cash Ratio Calculator. Evaluate if your Cash and Equivalents cover your short-term liabilities. Free financial tool.
How to Use Cash Ratio Calculator in 3 Easy Steps
1
Step 1
Input physical Cash stored in checking and savings accounts.
2
Step 2
Input Cash Equivalents (T-Bills, Money Markets).
3
Step 3
Input your total Current Liabilities to see your absolute worst-case survival metric.
Frequently Asked Questions
Cash sitting in a bank account loses value to inflation and generates minimal yield. Companies prefer to deploy that capital into operations, inventory, or stock buybacks to generate higher Returns on Equity (ROE).
No. While stocks are liquid, they possess significant price volatility. Cash equivalents must have a fixed, known value (like a 30-day Treasury Bill).
If a startup has a high monthly cash burn, their Cash Ratio will deteriorate rapidly month-over-month unless they secure further rounds of funding or reach profitability.