Which of the following is not included in the computation of the quick ratio?
A) Inventory
B) Marketable securities
C) Accounts receivable
D) Cash

Question

Quizplus · Accepted Answer

The quick ratio, also known as the acid test ratio, is a measure of a company's ability to meet its short-term obligations with its most liquid assets. The formula for quick ratio is (Cash + Marketable Securities + Accounts Receivable) / Current Liabilities. Inventory is not included in the computation because it is not as easily convertible to cash as the other assets.

Which of the Following Is Not Included in the Computation