Cash ratio calculator
Cash of 50,000 plus 30,000 in cash equivalents against 100,000 of current liabilities gives a cash ratio of 0.8, so the most liquid assets cover 80% of short-term obligations. It is the strictest liquidity test, with no inventory or receivables. Free in your browser.
- Free
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- Your data stays on your device
Run — free
Worked example
- Cash
- 50,000
- Cash equivalents
- 30,000
- Current liabilities
- 100,000
- Cash and equivalents
- 80,000
- Cash ratio
- 0.8
- Cash ratio percent
- 80
This cash ratio calculator measures the strictest form of short-term liquidity by dividing cash plus cash equivalents by current liabilities. Unlike the current ratio, which includes inventory and receivables, or the quick (acid-test) ratio, which still counts receivables, the cash ratio asks only whether the most liquid assets on the statement of financial position could settle every current obligation today. Enter cash, cash equivalents, and current liabilities in the same currency; the engine returns the decimal ratio, the same figure as a percent, the summed cash-and-equivalents total, and the formula used. Cash and cash equivalents may be zero; current liabilities must be strictly positive because a zero or negative denominator is undefined.
What the cash ratio measures and how it is computed
The cash ratio, sometimes called the cash asset ratio or cash coverage of current liabilities, answers the most conservative liquidity question on the balance sheet: if the firm had to pay every current obligation immediately, would cash and near-cash items be enough. Cash is the statement-of-financial-position line for currency, demand deposits, and other cash on hand.
Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and that are subject to an insignificant risk of changes in value — typical examples are Treasury bills, commercial paper, and money-market holdings that mature in three months or less. Current liabilities are obligations due within one year or the operating cycle, including accounts payable, accrued expenses, short-term borrowings, and the current portion of long-term debt, in the same currency and at the same reporting date as the cash figures.
Worked example: cash of 50,000 plus cash equivalents of 30,000 against current liabilities of 100,000 yields a ratio of 0.8 and a percent of 80, meaning cash and equivalents cover eighty percent of current obligations. Another example: cash of 200,000, no cash equivalents, and current liabilities of 400,000 yields 0.5. A ratio of 1.0 means the firm could theoretically retire all current liabilities with cash and equivalents alone; values above 1.0 mean a cash surplus over those liabilities.
This is a different search and a different credit question from working capital (current assets minus current liabilities) and from the current ratio (current assets over current liabilities): those metrics mix slower assets such as inventory into the cover, while this page isolates cash and cash equivalents only.
Where the cash ratio fits in liquidity analysis and automation
Lenders, credit analysts, and corporate treasurers use the cash ratio to stress the worst-case short-term cover: what happens if receivables stall and inventory cannot be sold quickly. Rating write-ups and bank memos often quote it alongside the current and quick ratios as the inner ring of the liquidity stack, treating a very high figure as conservative liquidity and a very low figure as dependence on converting other current assets.
Students and CFA candidates meet the same identity when a textbook asks for cash plus marketable securities, or cash equivalents, over current liabilities without building a full working-capital schedule. If you need net working capital or the current ratio from total current assets, use a working-capital tool; if you need operating cash flow over the stock of total debt, use cash flow to debt. This page answers only cash plus cash equivalents over current liabilities, with stable, reproducible output and no market data.
What you can do with it
Conservative liquidity screens
Divide cash plus cash equivalents by current liabilities to see whether the most liquid assets could cover short-term obligations before a credit committee or peer review.
Teaching and exam practice
Generate reproducible cash-ratio answers for homework keys, worksheets, and CFA-style liquidity drills that ask for (cash + cash equivalents) / current liabilities.
FAQ
Can cash or cash equivalents be zero?
Yes. A firm may hold only cash, only cash equivalents, or neither; a zero in either field is valid and simply reduces the numerator. Negative cash or equivalents is rejected.
How is this different from the current ratio or working capital?
The current ratio divides total current assets by current liabilities, and net working capital subtracts current liabilities from current assets. The cash ratio uses only cash plus cash equivalents in the numerator — a stricter liquidity metric and a different search intent.
What does the calculator cost?
It is free in your browser on this page.
What counts as a cash equivalent?
A short-term, highly liquid investment that converts readily to a known amount of cash with little risk of losing value. Typical examples are Treasury bills, commercial paper and money-market holdings that mature in three months or less.
How is the cash ratio different from the quick ratio?
The quick ratio, or acid test, still counts receivables as cover. The cash ratio leaves them out and keeps only cash and cash equivalents, so it shows what could be paid if customers stopped paying on time.
Related tools
For developers — API access
Everything on this page is available programmatically. This section is for teams who want to wire it into their own systems; everyone else can just use the tool above.
API endpoint
Prefer to automate it? One authenticated POST creates the task; the result comes back by webhook or a signed link. The same capability also runs here on the web, by email and from Telegram — and soon from our app too.
Call it from your stack
curl -X POST https://api.kit.forhosting.com/fin/cash-ratio \
-H "Authorization: Bearer $KIT_KEY" \
-H "Content-Type: application/json" \
-d '{"cash":50000,"cash_equivalents":30000,"current_liabilities":100000}'const res = await fetch("https://api.kit.forhosting.com/fin/cash-ratio", {
method: "POST",
headers: {
"Authorization": `Bearer ${process.env.KIT_KEY}`,
"Content-Type": "application/json"
},
body: JSON.stringify({
"cash": 50000,
"cash_equivalents": 30000,
"current_liabilities": 100000
})
});
const { task_id } = await res.json();import os, requests
res = requests.post(
"https://api.kit.forhosting.com/fin/cash-ratio",
headers={"Authorization": f"Bearer {os.environ['KIT_KEY']}"},
json={
"cash": 50000,
"cash_equivalents": 30000,
"current_liabilities": 100000
},
)
task_id = res.json()["task_id"]<?php
$res = file_get_contents("https://api.kit.forhosting.com/fin/cash-ratio", false, stream_context_create([
"http" => [
"method" => "POST",
"header" => "Authorization: Bearer " . getenv("KIT_KEY") . "\r\nContent-Type: application/json",
"content" => '{"cash":50000,"cash_equivalents":30000,"current_liabilities":100000}',
],
]));
$task = json_decode($res, true);body := bytes.NewBufferString(`{"cash":50000,"cash_equivalents":30000,"current_liabilities":100000}`)
req, _ := http.NewRequest("POST", "https://api.kit.forhosting.com/fin/cash-ratio", body)
req.Header.Set("Authorization", "Bearer "+os.Getenv("KIT_KEY"))
req.Header.Set("Content-Type", "application/json")
res, _ := http.DefaultClient.Do(req)Example request
{
"cash": 50000,
"cash_equivalents": 30000,
"current_liabilities": 100000
}Example response
{
"task_id": "tsk_a1b2c3d4e5f6a1b2c3d4e5f6",
"type": "fin.cash_ratio",
"status": "queued",
"_links": {
"result": "/tasks/tsk_…/result"
}
}The API is asynchronous: the call returns a task_id immediately and the result arrives by webhook. Polling is capped at 1 req/s per task.
Pricing
Published price — no tokens, no invented credits. A failed task is never charged.
Errors
| HTTP | Code | Meaning |
|---|---|---|
401 | unauthorized | Missing or invalid API key. |
402 | insufficient_balance | Your balance doesn't cover the task price. |
404 | unknown_type | That task type doesn't exist. |
429 | rate_limited | Too many requests. Use the webhook instead of polling. |
Technical notes
The work is pure deterministic arithmetic with no market feed, no network call, and no date shortcut, so the same inputs always produce the same JSON.
What the cash ratio measures and how it is computed
The identity used here is cash_ratio equals cash plus cash_equivalents, divided by current_liabilities.
Inputs, validation, rounding, and reading the result
There is no clock, locale, or randomness in the path. Prefer bare numbers over formatted strings; currency marks, thousands separators, and trailing unit labels are not parsed. Cash, cash_equivalents, and current_liabilities are required finite numbers in the same currency and the same reporting date. Cash and cash equivalents must be greater than or equal to zero; a negative cash or equivalents figure is not a standard cash-ratio input and returns a typed invalid_input error that names the field. Current liabilities must be strictly greater than zero: a zero or negative amount returns invalid_input because dividing by it is undefined. Optional aliases cash_on_hand and cash_balance map to cash; cash_equivalent, equivalents, and marketable_securities map to cash_equivalents; cl, total_current_liabilities, and liabilities_current map to current_liabilities so a spreadsheet export or form client can reuse familiar labels. On success the body echoes the rounded inputs, returns cash_and_equivalents as their sum, cash_ratio as the raw quotient, cash_ratio_percent as that quotient times one hundred so a dashboard can bind either a decimal or a percent, and a formula string set to cash_ratio = (cash + cash_equivalents) / current_liabilities. Failed validation is never billed; only successful API tasks consume prepaid balance at the published base rate of $0.002.
Where the cash ratio fits in liquidity analysis and automation
That split — free interactive exploration and a priced, identical API — lets you move from a single statement screen to an automated pipeline without changing the mathematical result.
Integration use cases
Portfolio and covenant monitoring
Batch the API across many issuers or reporting dates to flag any name whose cash ratio falls, or whose current liabilities would make the ratio undefined.
Technical questions
What is the cash ratio formula?
cash_ratio = (cash + cash_equivalents) / current_liabilities. The tool also returns cash_and_equivalents (the numerator) and cash_ratio_percent, which is that quotient times one hundred.
Why must current liabilities be greater than zero?
The ratio divides cash plus cash equivalents by current liabilities, so a zero or negative current_liabilities is undefined and returns invalid_input. The request is not billed.