What Is the Quick Ratio? Definition and Formula

quick ratio  Discover the essence of quick ratios: what they are, how to calculate them, why inventory is excluded, and strategies for improvement  The quick ratio is the value of a business's “quick” assets divided by its current liabilities Quick assets include cash and assets that can be

Quick Ratio = Current Liabilities Suppose the quick ratio for a business is This would indicate that the QUICK RATIO definition: → acid test ratio Learn more

The quick ratio is an indicator of a company's short term liquidity It measures the ability to pay short-term liabilities with highly liquid assets  A quick ratio of 1 or above indicates short-term solvency, or the ability of a company to meet its financial obligations for the time being The