The Current Liability Coverage Ratio Calculator is an essential tool for businesses to evaluate their short-term financial health. This calculator helps companies determine their ability to meet current liabilities using available assets. By inputting relevant financial data, users can quickly assess their liquidity position and identify potential cash flow issues. The tool is particularly valuable for financial managers, accountants, and business owners who need to monitor their company’s financial stability. Understanding your Current Liability Coverage Ratio can provide crucial insights for decision-making, financial planning, and risk management. Use our calculator today to gain a clear picture of your company’s financial health and take proactive steps towards improved liquidity management.
The current-liability-coverage ratio tells you how many dollars of operating cash back every dollar of average current liabilities. Public U.S. companies posted a 1.4 median ratio in 2022 (S&P Global Market Intelligence, 2023). A figure above 1 signals enough internally generated cash to settle near-term debts.
