The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets.
 | | Quick Ratio | | The quick ratio is an indicator of a company's short-term liquidity position, and measures a company's ability to meet its short-term obligations with its most liquid assets. Since it indicates the company's financial position to instantly use its near cash assets (that is, liquid assets) to get rid of its current liabilities, it is also called as the acid test ratio. An acid test is a quick test designed to produce instant results, hence the name. | | Breaking it Down: | | The quick ratio measures the dollar amount of liquid assets available with.... | | Read More » | | Understanding financial liquidity | | Financial liquidity comes into play for companies, your personal finances, investing, and the financial markets. However, assets and investments have varying liquidity levels. | | Read More » | | | Ratio Analysis | | A ratio analysis is a quantitative analysis of information contained in a company's financial statements. | | Read More » | | | Short Term | | Short term means holding an asset for a short period of time or it's an asset expected to be converted into cash in the next year. | | Read More » | | | Efficiency Ratio | | The efficiency ratio is used to analyze how well a company utilizes its assets and liabilities internally. | | Read More » | | | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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