Financial Ratios
Quick Ratio
Definition
What is Quick Ratio?
Liquid current assetsAssets expected to be realised, sold, or used within the normal operating cycle or about one year. divided by current liabilitiesObligations expected to be settled within the normal operating cycle or about one year., commonly excluding inventoryGoods held for sale, production, or consumption in the production process. and prepayments.
Example in practice
How This Looks in Practice
Cash and receivables of ₦900 million against ₦600 million current liabilities give a 1.5 quick ratio.
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Related Terms
Financial Ratios
Gross Margin
Gross profit expressed as a percentage of revenue.
Financial RatiosOperating Margin
Operating profit expressed as a percentage of revenue.
Financial RatiosEBITDA Margin
EBITDA expressed as a percentage of revenue.
Equity ValuationEarnings Per Share
Net income attributable to ordinary shareholders divided by weighted average ordinary shares.