Altman Z-Score Financial Bankruptcy Predictor Calculator
The Altman Z-Score is a quantitative financial model developed by NYU Professor Edward Altman in 1968 to predict corporate bankruptcy risk within a two-year horizon.
⚙ Input Values
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📐 Formula
💡 Practical Example
Company with $1,000,000 Total Assets, $400,000 Total Liabilities, $150,000 Working Capital, $300,000 Retained Earnings, $200,000 EBIT, $800,000 Equity, $1,200,000 Sales: X1 = 0.15, X2 = 0.30, X3 = 0.20, X4 = 2.00, X5 = 1.20. Z = 1.2(0.15) + 1.4(0.30) + 3.3(0.20) + 0.6(2.00) + 0.999(1.20) = 0.18 + 0.42 + 0.66 + 1.20 + 1.1988 = 3.66 (Safe Zone).
📖 About Altman Z-Score Financial Bankruptcy Predictor Calculator
The Altman Z-Score is a quantitative financial model developed by NYU Professor Edward Altman in 1968 to predict corporate bankruptcy risk within a two-year horizon.
To use the Altman Z-Score Financial Bankruptcy Predictor Calculator, enter your Working Capital (), Retained Earnings (), Earnings Before Interest & Taxes (EBIT) () and other values. The calculator instantly computes Altman Z-Score, Financial Solvency Zone and more. Results update in real time as you change any input — no submit button needed.
How to Use This Calculator
Enter your Working Capital () (e.g. 150000 in ), Retained Earnings () (e.g. 300000 in ), Earnings Before Interest & Taxes (EBIT) () (e.g. 200000 in ), Market Value of Equity / Market Cap () (e.g. 800000 in ), Total Sales Revenue () (e.g. 1200000 in ), Total Assets () (e.g. 1000000 in ), and Total Liabilities / Debt () (e.g. 400000 in ). Results update instantly as you type — adjust any value to compare scenarios.
The Formula
Z = 1.2(X1) + 1.4(X2) + 3.3(X3) + 0.6(X4) + 0.999(X5)
Where X1 = Working Capital / Total Assets, X2 = Retained Earnings / Total Assets, X3 = EBIT / Total Assets, X4 = Market Value of Equity / Total Liabilities, X5 = Sales / Total Assets
Worked Example
Company with 1,000,000 Total Assets, 400,000 Total Liabilities, 150,000 Working Capital, 300,000 Retained Earnings, 200,000 EBIT, 800,000 Equity, 1,200,000 Sales:
X1 = 0.15, X2 = 0.30, X3 = 0.20, X4 = 2.00, X5 = 1.
20.
Z = 1.2(0.15) + 1.4(0.30) + 3.3(0.20) + 0.6(2.00) + 0.999(1.20) = 0.18 + 0.42 + 0.66 + 1.20 + 1.1988 = 3.66 (Safe Zone).
Understanding Your Result
Compare your result against industry benchmarks for your specific sector — significant variation exists across industries, business stages, and geographic markets. Use this calculation as one data point alongside your unit economics, cash flow, and competitive positioning. For decisions involving significant capital allocation, validate your model assumptions with historical actuals from at least 6–12 months of operating data before projecting forward.
💡 Methodological Standards & Calculation Accuracy
- All calculations are performed client-side in your browser using verified, standards-compliant mathematical algorithms.
- Results are provided for educational and informational analysis; verify critical applications with certified domain specialists.
- Ensure input values are entered in consistent units matching the selector options to guarantee accurate outputs.
- Periodic recalibration is recommended whenever baseline assumptions, operating parameters, or external conditions change.
Results are for informational and educational purposes only. Always verify critical decisions with a qualified professional.