Which formula defines the quick ratio?

Question

Quizplus · Accepted Answer

The quick ratio, also known as the acid-test ratio, is a financial ratio that measures a company's ability to pay its current liabilities using its most liquid assets. The formula for the quick ratio is financial assets (cash, cash equivalents, short-term investments) divided by current debt (current liabilities excluding inventory and prepaid expenses). Therefore, the correct formula for the quick ratio is A) financial assets/current debt.

Which Formula Defines the Quick Ratio