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Acid Test

A test used with gold to determine if the presented material is real. In the business world, it is also known as ‘Quick Ratio’. The formula is simply: Current Assets less Inventory/Current Liabilities.

Quick Ratio – Definition, Explanation and Proper Use

01/14/2014

The quick ratio is a formula used in business to identify the ability of a business to pay its current liabilities.  It is also known as the ‘Acid Test’ formula (ratio).  In the large markets this formula is one of the financial industry [...]