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 quick ratio, also known as the acid-test ratio, measures a company's ability to pay off its current debt. Current debt includes any liabilities coming due within a year, like accounts payable and ...

The worst news investors can get is that a company whose stock they own has gone bankrupt. As cataclysmic as bankruptcy can be, there are usually warning signs that astute investors can look for ...

The Acid Test ratio is a key balance sheet liquidity ratio that helps you estimate how well a company can handle a credit crunch. The acid test ratio is a balance sheet-based financial measure ...

The acid-test ratio is a financial metric that assesses a company’s ability to cover short-term liabilities with its most liquid assets. A higher acid-test ratio suggests a stronger liquidity position ...

As a contrast, less stringent ratios include short-term assets like inventories -- products and materials the company could sell or plans to sell, but hasn't sold. Those are tougher to convert to cash ...