Quick Ratio

A liquidity metric that measures a company's ability to meet short-term obligations using only its most liquid assets -- cash, marketable securities, and accounts receivable -- excluding inventory. Also known as the "acid-test ratio," it is calculated by dividing current assets minus inventory by current liabilities. A quick ratio above 1.0 generally indicates a company can cover its near-term liabilities without selling inventory, making it a stricter test of financial health than the current ratio.