Acid Test Ratio Calculator
Calculate the acid test ratio.
Acid Test Ratio Calculator
About Acid Test Ratio Calculator
The Acid Test Ratio Calculator is used to calculate the acid test ratio.
Acid Test Ratio Definition
Acid test ratio is a stringent test that indicates whether a firm has enough short-term assets to cover its immediate liabilities without selling inventory. Generally, the acid test ratio should be 1:1 or higher; however, this varies widely by industry.
Acid Test Ratio Formula
The acid test ratio calculation formula is as follows:
Acid Test Ratio = (Cash + Accounts Receivable + Short-term Investments) / Current Liabilities
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