Why exclude inventory specifically?

Inventory can take time to sell and convert to cash, so excluding it gives a more conservative view of a company's immediate ability to cover liabilities.

Quick Ratio Calculator

The quick ratio is a stricter liquidity measure than the current ratio, excluding inventory since it can be harder to quickly convert to cash.

Inputs

Results

Quick Ratio: 1.52

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Formula

Quick Ratio = (Current Assets − Inventory) / Current Liabilities

Learn How This Works

Reading Your Balance Sheet: Liquidity Ratios Explained

A practical walkthrough of current ratio, quick ratio, working capital, and debt-to-equity — the four numbers that show whether a business can cover its bills.

Frequently Asked Questions

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