Liquid Assets to Current Liabilities Ratio
Remove inventory and prepayments when you check short-term debt coverage.
Your numbers
Quick assets to current liabilities ratio
Business ratio from inputs for the same consistent period. Accounting definitions and industry comparisons fit differ.
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Formula
Use Q = (A−I−P)/L. A na current assets, I na inventory, P na prepayments, and L na current liabilities. Quick ratio remove inventory and prepayments from the numerator.
Remove inventory and prepayments when you check short-term debt coverage.
Example wey show the calculation
- Assets wey fit turn cash soon
- 200000
- Stock wey business hold
- 50000
- Payments wey business make ahead
- 10000
- Debts wey you suppose pay soon
- 100000
- Quick assets to current liabilities ratio
- 1.4
Where e fit work and limits
Business ratio from inputs for the same consistent period. Accounting definitions and industry comparisons fit differ.
We check inputs for missing values and allowed ranges. Result wey pass the finite numeric range no go show. Rounding affect wetin display, while calculation use the model numeric precision.
Check your units and assumptions before you rely on result. Changing label no convert currency or physical unit.
Version of di formula: 90581347b19d · Example don get check: