Question

is equal to quick assets divided by quick liabilities​

Answer 1

Explanation:

Quick ratio: The quick ratio formula uses current liquid assets, which are assets that can be turned into cash quickly, divided by current liabilities. The quick ratio does not include inventory, prepaid expenses, or supplies in its calculation

Answer 2

Answer:

The quick ratio is calculated by dividing a company's current obligations by the value of its "quick" assets. Cash and assets that may be turned into cash quickly, often within 90 days, are referred to as "quick assets."

Explanation:

• The quick ratio, often known as the acid test, is a financial ratio that divides the sum of a company's cash and equivalents, marketable securities, and accounts receivable by its current liabilities. The entire quantity of quick assets is employed in this calculation.
• A quick ratio is calculated by dividing fast assets by quick liabilities. The quick ratio is an indicator of a company's short-term liquidity situation and measures its ability to meet short-term commitments with its most liquid assets.
• The quick ratio is derived by dividing the total of the company's current obligations by the sum of its cash and cash equivalents, short-term investments, and account receivables. Quick assets are another name for these extremely liquid investments.

There are two ways to calculate quick ratio: QR = (Current Assets - Inventories - Prepaid Expenses) / Current Liabilities. QR = (Cash + Cash Equivalents + Marketable Securities + Accounts Receivable) / Current Liabilities.