Liquidity Ratios and Acid Test .

Ticktock

These are fractional, or decimal indicators of health of a company.. A percentage of company assets over company liabilities

A business might have five pounds cash in the bank, and twenty pounds of debt.  So, Acid rest is 5/20.  A quarter or 0.25 as an acid test value..  if the company is dissolved today. Acid Test is of value of one or less.

Dave T.

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Published by Ticktock

Thanks, I'm at the end of my tether.. My specs aren't great for everyday, even need (but I don't get) readers that function!