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 first liquidity ratio we examined in digesting Axel Tracy's book, "Ratio Analysis Fundamentals: How 17 Financial Ratios Can Allow You to Analyse Any Business on the Planet," was the current ratio.
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