Near-term assets over near-term claims
Current ratio divides current assets by current liabilities on the same statement date. Working capital is the dollar gap: current assets minus current liabilities. A ratio of 1× means the two sides match and working capital is $0. Values below 1× leave a negative working-capital gap. Debt-to-equity is a stock leverage ratio, not this liquidity identity. Cash runway divides cash by monthly net burn. This page does not compute a quick ratio.
Working capital = current assets − current liabilities
Example
$250,000 of current assets and $125,000 of current liabilities is 2×, with $125,000 of working capital. OpenStax’s $200,000 / $100,000 example is also 2.0×. $80 of current assets against $100 of current liabilities is 0.8× and −$20 of working capital.
What this ratio leaves out
Current liabilities must be positive. Inventory, receivables, and prepaid items sit inside current assets and can overstate cash-like liquidity. Classification of current versus noncurrent, a quick or cash ratio, and industry target ranges stay outside this two-number identity. Use amounts from the same date.