What is the difference?
Quick Ratio vs Current Ratio
Quick Ratio
Current Ratio
What is it?
The Quick Ratio measures the ability of your organization to meet any short-term financial obligations with assets that can be quickly converted into cash. It considers the ability for Current Assets, less inventory, to cover Current Liabilities.
Current Ratio measures the ability of your organization to pay all of their financial obligations in the short term, which is generally one year. This ratio accounts for your current assets, such as accounts receivable, and your current liabilities, such as accounts payable, to help you understand the solvency of your business.
Who is it for?
Categories
Formula
ƒ (Current Assets – Inventory) / (Current Liabilities)
ƒ Sum(Current Assets) / Sum(Current Liabilities)
Published and updated dates
Date created: Mar 1, 2019
Latest update: Oct 18, 2019
Date created: Feb 8, 2019
Latest update: May 18, 2021