What Is Quick Ratio? Definitions, Calculations and Examples

quick ratio  Quick Ratio Conclusion · Quick assets are current assets that a company can convert into cash within the short term · To calculate the Quick ratio only uses quick assets and excludes any assets that can't be liquidated and converted into cash in 90 days or less The current ratio considers all

A quick ratio of 2, as calculated above, indicates that the company has twice as many easily liquidated assets as it has short-term liabilities  The quick ratio formula is: quick ratio = quick assets current liabilities

The quick ratio measures a company's ability to pay its current liabilities by readily converting some of its current assets into cash  Summary · A liquidity ratio is used to determine a company's ability to pay its short-term debt obligations · The three main liquidity ratios are the current