The acid-test ratio is a measure of a company's liquidity, although it is mostly used when a company is believed to be illiquid. It is a ratio that measures a company's ability to meet its current ...

The acid-test ratio measures a company's ability to cover short-term liabilities with its most liquid assets. A ratio above 1 suggests good liquidity; below 1 indicates potential payment struggles ...

Investors evaluate a company's ability to satisfy short-term debts with liquid assets using the quick ratio. Find out how to calculate it, interpret it, and more.

In order to calculate the acid test ratio, you'll need to look at a company's most recent balance sheet.

What Is the Quick (Acid Test) Ratio? The quick ratio is a metric that offers investors and analysts a simple look at how liquid a company is in the short term by comparing the value of its most ...

A liquidity ratio that measures a company’s ability to meet its current obligations by removing inventory from a company’s current assets. This ratio reflects the illiquidity of inventory and ...