Net Operating Working Capital Calculator
Find out how much cash your business has tied up in everyday operations by calculating net operating working capital (NOWC).
What Is Net Operating Working Capital?
Net Operating Working Capital (NOWC) measures the cash a business has tied up in the assets and liabilities directly used in its core operations, excluding non-operating items like short-term investments or interest-bearing debt.
The Formula
NOWC = (Operating Cash + Accounts Receivable + Inventory) − (Accounts Payable + Accrued Liabilities). A positive NOWC means operations require ongoing cash investment; a very low or negative NOWC can signal an efficient cash cycle, or in some cases collection or payment risk.
- Operating current assets are the cash, receivables, and inventory used to run the business.
- Operating current liabilities are payables and accruals that arise from those same operations.
This calculator is for general financial planning and educational purposes and does not substitute for professional accounting advice.