Question:
...... is also known as the Acid Test Ratio.
...... is also known as the Acid Test Ratio.
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The quick ratio is calculated as:
\[
\text{Quick Ratio} = \frac{\text{Quick Assets}}{\text{Current Liabilities}}
\]
Updated On: Jan 28, 2025
- Current ratio
- Quick ratio
- Gross profit ratio
- Return on investment ratio
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The Correct Option is B
Solution and Explanation
The quick ratio is also referred to as the Acid Test Ratio. It excludes inventory and prepaid expenses, providing a stringent measure of liquidity.
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\vspace{0.2cm} \begin{tabular}{|l|r|r|} \hline Particulars & Dr. Amount (Rs) & Cr. Amount (Rs)
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