Bankruptcy risk score of a company. The Altman Z-Score Calculator takes working capital, total assets, retained earnings, operating profit (ebit), market value of equity, total liabilities, sales and returns altman z-score plus zone. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Financial ratios are only useful in comparison: against last year, against a competitor, or against the benchmark for your industry. Take the figures from the same set of accounts, note whether they are yearly or monthly, and read each ratio alongside the others in its family. Use the worked example below to check the maths against your own figures.
How the Altman Z-Score Calculator works
The original Altman model for public manufacturing companies combines five ratios into one score: above 2.99 is safe, below 1.81 signals distress. For private companies use book equity for MVE and treat the result as indicative.
Worked example
With the example values (working capital of $500,000, total assets of $3,000,000, retained earnings of $400,000, operating profit (ebit) of $350,000, market value of equity of $2,000,000, total liabilities of $1,500,000, sales of $4,000,000), the altman z-score is 2.9; zone Grey zone. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
Assumptions and limits: Original 1968 coefficients for listed manufacturers; private and service companies have different cut-offs.
Related Calculators
Frequently Asked Questions
How is altman z-score calculated?
Z = 1.2 × WC/TA + 1.4 × RE/TA + 3.3 × EBIT/TA + 0.6 × MVE/TL + 1.0 × sales/TA.
Which figures do I need?
Working capital, total assets, retained earnings, operating profit (ebit), market value of equity, total liabilities, sales. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
What is a good value for this ratio?
Benchmarks differ by industry, size and business model, so compare with companies like yours and with your own history. A ratio moving in the wrong direction for several periods matters more than any single number.
What assumptions does this calculator make?
Original 1968 coefficients for listed manufacturers; private and service companies have different cut-offs.
