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LSDefine

Simple English definitions for legal terms

quick ratio

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A quick definition of quick ratio:

The quick ratio, also known as the acid-test ratio, is a measure of a company's ability to pay off its short-term debts using its most liquid assets, such as cash and accounts receivable. It is calculated by dividing the total quick assets by the total current liabilities. This ratio is important because it shows how well a company can meet its financial obligations without having to sell off its long-term assets.

A more thorough explanation:

The quick ratio, also known as the quick-asset ratio or acid-test ratio, is a financial ratio that measures a company's ability to pay off its current liabilities with its most liquid assets. These assets include cash, marketable securities, and accounts receivable.

Quick Ratio = (Current Assets - Inventory - Prepaid Expenses) / Current Liabilities

Let's say Company A has $100,000 in current assets, $20,000 in inventory, and $5,000 in prepaid expenses. Its current liabilities are $50,000. To calculate the quick ratio, we would subtract the inventory and prepaid expenses from the current assets:

Quick Ratio = ($100,000 - $20,000 - $5,000) / $50,000 = 1.5

This means that Company A has $1.50 in liquid assets for every $1 of current liabilities. A quick ratio of 1 or higher is generally considered good, as it indicates that the company can meet its short-term obligations without having to sell off its inventory or other assets.

quickie strike | quick-take

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9:28
congrats on the 172 bruce
go dawgs fr
9:29
roll tide
do we foresee a fordham election day wave today (i'm delusional)
WorthlessAttractiveZombie
9:31
I think so, Jack
9:31
some people hate him. some people love him, but he a real one: https://youtu.be/w5oEqiVQcF4?t=173
9:32
[kevin oleary]
worthless i trust you implicitly you know what it will happen now.
worthless i trust you implicitly you know what it will happen now.
worthless i trust you implicitly you know what it will happen now.
worthless i trust you implicitly you know what it will happen now.
worthless i trust you implicitly you know what it will happen now.
WorthlessAttractiveZombie
9:34
I mean if Fordham doesn't release today I will purposefully get on a train, go to new york, and then take the stinkiest shit inside the admission office's toilet (potentially clogging it and forcing them to get a plumber)
IS IT ONLY ON MY END WHY DID THAT SEND TEN MILLION TIMES
HELLO
WorthlessAttractiveZombie
9:35
it sent a million times lol
WHAT HAPPENED
yeah i thought you were tweaking for a second
i'm so sorry everyone what the actual fuck this website hates me
WorthlessAttractiveZombie
9:35
Jack's just tweaking on LSD no biggie
to be fair this accurately represents my mental state
election day psychosis coming in hot (fordham)
usc pls pull through .....
i literally just need one A so i can relax before my ED decision
WorthlessAttractiveZombie
9:38
oh that's right USC might release
soapy
9:43
USC still has not looked at my app
WorthlessAttractiveZombie
9:43
when did you submit soapy?
soapy
9:44
10/16
WorthlessAttractiveZombie
9:44
to be fair it took them almost 2 months for me to go under review
soapy
9:44
Feelin a bit stressed, as I've got no date change for Michigan either despite applying 10/7
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