Quick Ratio (Acid-Test) Calculator

Assess liquidity using a stricter measure than the current ratio by excluding inventory from current assets.

Inputs

Current Assets (₹)

01,00,00,00,000

Inventory (₹)

01,00,00,00,000

Current Liabilities (₹)

11,00,00,00,000

Calculation Results

Quick Ratio (Acid-Test)

1.5

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Formula & Mathematical Explanation

\displaystyle \text{Quick Ratio} = \frac{\text{Current Assets} - \text{Inventory}}{\text{Current Liabilities}}

The quick ratio (acid-test ratio) measures a company's capacity to meet its short-term obligations with its most liquid assets, excluding inventory since it is harder to turn into cash quickly.