Finance & Accounting / Treasury
Current Ratio vs Quick Ratio
Two measures of short-term solvency, can the company cover what it owes within a year, differing only in how much of "current assets" they trust to convert to cash quickly.
The fork, why two teams get different numbers
Current ratio counts all current assets, including inventory and prepaids.
In the Metric Library
- The full fork, both definitions worked all the way through
- The trap that makes the number lie, on a real export
- Every formula variant, spelled out
- The reconciliation anchor, what to tie it to and when to refuse
Reference: FASB ASC 210 (Balance Sheet Classification) · SEC Regulation S-X Rule 5-02