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 first liquidity ratio we examined in digesting Axel Tracy's book, "Ratio Analysis Fundamentals: How 17 Financial Ratios Can Allow You to Analyse Any Business on the Planet," was the current ratio.
How well can current assets cover current liabilities? Reviewed by Amy Drury The acid-test ratio (ATR), also commonly known as the quick ratio, measures the liquidity of a company by calculating how ...
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