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 + ...

A quick ratio tests a company’s current liquidity and solvency. It is a measure of whether the company can pay its short-term obligations with its cash or cash-like assets on hand. (Short term ...

Sound financial management is necessary in a small business -- to make the most of your assets, you need to properly account for them. The quick ratio is a simple financial ratio that can help you to ...

Liquidity ratios are key financial ratios used by internal and external analysts to gauge a company's liquidity, which represents its capacity to pay its existing short-term liabilities if it needs to ...

Daniel Liberto is a journalist with over 10 years of experience working with publications such as the Financial Times, The Independent, and Investors Chronicle. Amy is an ACA and the CEO and founder ...

For investors and business management alike, a few critical financial ratios help assess a company's financial health. One of the common ways of using these ratios is to compare them, ratio by ratio, ...

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 ...

Financial ratios are calculations that compare two (or more) pieces of financial data that are normally found in a company's financial statements. Ratios can be invaluable to investors making ...

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

The defensive interval ratio (DIR) is a financial metric that can help investors assess a company's ability to meet its short-term operating expenses using its liquid assets. Also known as the basic ...