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Basic Question 14 of 23

The quick ratio ______

I. is a measure of short-term debt-paying ability.
II. calculation includes inventory.
III. is used to evaluate profitability.
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User Contributed Comments 2

User Comment
fabsan The denominator of the Quick ratio is = Tot Short Term Liabilities (not the debt).
maryprz14 It is a measure of short-term liability paying ability, not debt. Debt is long term and bears interest, short-term liability does not bear interest so is not DEBT.
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Martin Rockenfeldt

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Learning Outcome Statements

explain liquidity and compare issuers' liquidity levels

CFA® 2024 Level I Curriculum, Volume 2, Module 4.