Skip to main content

Quick assets divided by the current liabilities is the:?

Quick assets divided by current liabilities is referred to as:
a) Acid-test ratio
b) Current ratio
c) Working capital ratio
d) Current liability turnover ratio
e) Quick asset turnover ratio

2 Answers

A
Anonymous

Feb 22, 2025

https://shorturl.im/GE7Ut

If you mean current assets divided by current liabilities this is called the current ratio. If you go a bit further and deduct stock and prepayments from the assets and deduct the bank overdraft from the liabilities you get the Quick ratio or acid test. This tells you the ability (or not) of the company being able to pay its current liabilities with its cash or near cash assets. The ratio should be more than 1:1

Want to answer this question?

Join our community to share your knowledge!

Related Questions

8
Does Wells Fargo Bank open on Sundays?

Does Wells Fargo Bank open on Sundays in Bakersfield, California, specifically at the intersection of White Lane and Gos...

1
Present and future values for different interest rates find the following values. compounding/discounting occurs annually. round your

Please find below the present and future values for different interest rates. Compounding and discounting occur annually...

5
What is a bank account nickname?

I’m trying to make my car payment online, and it’s asking for a bank account nickname. What does that mean, and what sho...

3
Why do all shareholders agree on the same goal for the financial​ manager? ?

What is the reason that all shareholders tend to agree on a common goal for the financial manager?

3
Presented below are selected account balances for Homer Winslow Co as of December 31, 2014. Instructions: Prepare closing entries

Presented below are selected account balances for Homer Winslow Co. as of December 31, 2014. Instructions: Prepare the...

3
On December 31, Fighting Okra Cooking Services reports the following revenues and expenses.

On December 31, Fighting Okra Cooking Services reported the following revenues and expenses.

3
Presented below is information from perez computers incorporated. july 1 sold $20,000 of computers to robertson company with terms

Presented below is information from Perez Computers Incorporated. On July 1, the company sold $20,000 worth of computers...

1
It is a GAAP standard that ___ copy(ies) of a check be attached to all documents for filing?

Is it a GAAP requirement to attach a copy of a check to all documents for filing purposes, and if so, how many copies ar...

3
Presented below is information related to equipment owned by Suarez Company at December 31, 2017.

Presented below is the information regarding the equipment owned by Suarez Company as of December 31, 2017. Please revie...

1
How is it possible that Venezuela, with the largest oil and gas wealth on earth, is having such horrible economic problems?

What explains the paradox of Venezuela, a country rich in oil and gas resources, facing such severe economic challenges?