Net Operating Working Capital (NOWC) Calculator

Formula

The formulas used in the calculations are:

\[ \text{Current Operating Assets} = \text{Cash} + \text{Accounts Receivable} + \text{Inventories} \]

\[ \text{Current Operating Liabilities} = \text{Accounts Payable} + \text{Accrued Expenses} \]

\[ \text{Net Operating Working Capital (NOWC)} = \text{Current Operating Assets} - \text{Current Operating Liabilities} \]

Description

This calculator computes the Net Operating Working Capital (NOWC) based on the input values of Cash, Accounts Receivable, Inventories, Accounts Payable, and Accrued Expenses. Net Operating Working Capital represents the difference between a company's current operating assets and current operating liabilities.

Example Calculation

Let's assume the following:

Cash: $1,000
Accounts Receivable: $15,000
Inventories: $5,000
Accounts Payable: $18,000
Accrued Expenses: $2,000

Calculate the Current Operating Assets:

\[ \text{Current Operating Assets} = 1,000 + 15,000 + 5,000 = 21,000 \]

Calculate the Current Operating Liabilities:

\[ \text{Current Operating Liabilities} = 18,000 + 2,000 = 20,000 \]

Calculate the Net Operating Working Capital (NOWC):

\[ \text{Net Operating Working Capital (NOWC)} = 21,000 - 20,000 = 1,000 \]

Therefore, the Net Operating Working Capital (NOWC) is $1,000.