Another name for the acid test ratio is the
A)current ratio.
B)quick ratio.
C)inventory turnover ratio.
D)average collection period.

Question

Quizplus · Accepted Answer

The acid test ratio is also known as the quick ratio, which measures a company's ability to meet short-term obligations with its most liquid assets. It excludes inventory from the calculation since it's not always easily convertible to cash. Therefore, the best choice is (B) quick ratio.

Another Name for the Acid Test Ratio Is the