Question

recelvablesy

Answer 1

Ans: current Liabilities

Explanation:

1)Acid Test Ratio = Quick Assets/Current Liabilities

(where quick assets = Total Current Assets - Inventory - Prepaid Expenses)

          i.e cash+ short term investments+ current receivables

2) Acid test ratio also known as quick ratio

3) The acid-test ratio is a strong indicator of whether a firm has sufficient short-term assets to meet its immediate liabilities