What is the meaning of Quick (Asset) Ratio?

Quick (Asset) Ratio is a liquidity measure: cash plus cash equivalents plus trade receivables divided by total current liabilities. Also known as the acid test ratio. It is a more stringent measure of short-term liquidity than the current ratio because it excludes inventories from current assets (which presumes that current liabilities cannot be paid with inventory).

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APABarry Goldsmith. (2010). quick (asset) ratio. Retrieved September 20, 2026, from http://smartdefine.org/quick_(asset)_ratio/definitions/1161660
ChicagoBarry Goldsmith. 2010. "quick (asset) ratio" http://smartdefine.org/quick_(asset)_ratio/definitions/1161660 (accessed September 20, 2026).
HarvardBarry Goldsmith 2010, quick (asset) ratio, Smart Define, viewed 20 September, 2026, <http://smartdefine.org/quick_(asset)_ratio/definitions/1161660>.
MLABarry Goldsmith. "quick (asset) ratio" 21 October 2010. Web. 20 September 2026. <http://smartdefine.org/quick_(asset)_ratio/definitions/1161660>