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 quick ratio, often referred to as the acid-test ratio, measures a company's ability to cover its short-term liabilities with its most liquid assets, excluding inventory. It's calculated as (cash + ...

Source: LendingMemo.com via Flickr. The acid test ratio is a balance sheet-based financial measure designed to help you judge how well a company can cover its short-term obligations. It is considered ...

A quick ratio below industry standard means that your company has a relatively lower liquidity position than its competitors on one of the three common liquidity ratios used by companies. The quick ...

The acid test ratio is a balance sheet-based financial measure designed to help you judge how well a company can cover its short-term obligations. It is considered a stringent measure of the company's ...

As a contrast, less stringent ratios include short-term assets like inventories -- products and materials the company could sell or plans to sell, but hasn't sold. Those are tougher to convert to cash ...

The current ratio is a widely understood financial metric, familiar even to those with a basic knowledge of banking and finance. It is routinely used by bankers during the credit appraisal process for ...