The-definition.com

Definition

Acid-test (quick) ratio

Acid-test (quick) ratio is a measure of a company’s immediate short-term liquidity; computed by dividing the sum of cash, short-term investments, and net receivables by current liabilities. Thus, it is an important complement to the current ratio.

Share it:  Cite

More from this Section

  • Acid test ratio
    Acid test ratio is a measure of a firm’s ability to pay current debts from its most ...
  • Total quality management (TQM)
    Total quality management (TQM) systems implemented to reduce defects in finished products ...
  • Cost Principles
    The cost principles, also known as the historical cost principle is one of the basic underlying ...
  • Median
    Median is the point in a distribution of scores that divides the distribution precisely ...
  • Grantor Trust
    Grantor Trust is a form of trust that permits the grantor to have control over one or ...