View source for ACID TEST RATIO

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== Definitions ==

(or [[QUICK_RATIO|quick ratio]] or [[LIQUID_RATIO|liquid ratio]]) the [[RATIO|ratio]] of total [[CASH|cash]], [[ACCOUNTS_RECEIVABLE|accounts receivable]] and the [[MARKET_VALUE|market value]] of saleable investments of a [[BUSINESS|business]] to its [[CURRENT_LIABILITIES|current liabilities]], the result [[ACTING|acting]] as a guide to [[CREDIT_RATING|credit rating]] and [[ESTABLISHING|establishing]] a [[COMPANY|company]]'s [[ABILITY|ability]] to [[HANDLE|handle]] current obligations.