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Sales to Net Working Capital Ratio Calculator

Formula

The formula to calculate the Sales to Net Working Capital Ratio (SNWCR) is:

$SNWCR = \frac{S}{NWC}$

Where:

$SNWCR$ is the Sales to Net Working Capital Ratio (dimensionless)
$S$ is the Total Sales Revenue ($)
$NWC$ is the Net Working Capital ($)

What is Sales to Net Working Capital Ratio?

The Sales to Net Working Capital Ratio is a financial metric that measures how efficiently a company is using its net working capital to generate sales. A higher ratio indicates that the company is effectively using its working capital to support sales activities, while a lower ratio may suggest inefficiencies.

Example Calculation

Let's assume the following values:

Total Sales Revenue (S) = $1,000,000
Net Working Capital (NWC) = $200,000

Using the formula to calculate the Sales to Net Working Capital Ratio:

$SNWCR = \frac{1,000,000}{200,000} = 5$

The Sales to Net Working Capital Ratio is 5.