Question:
\(\_\_\_\_\_\_\) is also known as Acid-Test Ratio.
\(\_\_\_\_\_\_\) is also known as Acid-Test Ratio.
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The Quick Ratio excludes inventory and prepaid expenses, providing a stricter measure of liquidity compared to the Current Ratio.
Updated On: Jan 13, 2026
- Current Ratio
- Quick Ratio
- Gross Profit Ratio
- Operating Ratio
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The Correct Option is B
Solution and Explanation
The Quick Ratio, also known as the Acid-Test Ratio, is a measure of a company’s ability to meet its short-term liabilities using its most liquid assets (excluding inventory).
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