Quick Ratio (당좌비율) — How to Measure a Company’s Liquidity

 

Illustration of liquidity balance — showing cash and receivables covering short-term liabilities

📊 Quick Ratio (당좌비율) — Understanding Company Liquidity

💡 What is the Quick Ratio?

The Quick Ratio, or Acid-Test Ratio, measures how easily a company can pay its short-term debts using assets that can quickly turn into cash. Unlike the Current Ratio, it excludes inventory and other less liquid assets, focusing only on truly “ready” funds.

📘 Formula

👉 Quick Ratio = (Cash + Marketable Securities + Accounts Receivable) ÷ Current Liabilities

📈 Why It Matters

A ratio above 1.0 means the company can cover its short-term debts without selling inventory.

A ratio below 1.0 suggests possible liquidity pressure or reliance on inventory for payments.

Investors and creditors use this ratio to evaluate short-term financial health.

🧮 Example

If a company has $200,000 in quick assets and $150,000 in current liabilities,

👉 Quick Ratio = 200,000 ÷ 150,000 = 1.33

✅ The company has $1.33 in liquid assets for every $1 of short-term debt.

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