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Quick ratio (acid-test ratio)
Current assets without inventory, divided by current liabilities: the formula, how it differs from the current ratio, and the figures for each company.
The short answer
The quick ratio, also called the acid-test ratio, is current assets minus inventory, divided by current liabilities. It asks the same question as the current ratio, whether short-term assets cover short-term debts, but leaves out inventory, which has to be sold before it becomes cash. For the 63 companies here that report inventory, the median quick ratio is 0.92, against a median current ratio of 1.14.
The formula
Quick ratio = (current assets − inventory) ÷ current liabilities
All three numbers are on the balance sheet. A stricter version counts only cash, short-term investments and receivables, which also drops prepaid expenses and other small current assets. The table uses the simpler version, so it can be worked out from three lines that almost every 10-K reports.
Why take inventory out
Inventory is the slowest current asset to turn into cash. It has to be sold first, sometimes at a discount, and then the customer has to pay. Cash and receivables are much closer to money in hand. The gap between the current ratio and the quick ratio shows how much of a company's short-term cushion sits in goods on shelves or in warehouses.
In this group the gap is widest at Texas Instruments: a current ratio of 4.35 and a quick ratio of 2.83, with inventory of $4.8B out of $13.8B in current assets. Inventory and inventory turnover covers how fast that stock moves.
Walmart and Apple
Walmart reported current assets of $84.9B, of which $58.9B was inventory, against current liabilities of $107.5B at the end of fiscal 2026. That's a current ratio of 0.79 and a quick ratio of 0.24. A grocer that sells its stock in weeks and pays suppliers later can run this way for years, as working capital explains.
Apple carries little inventory for its size: $14.5B against $173.9B of current assets, so its quick ratio of 0.94 is close to its current ratio of 1.02.
Source: Walmart 10-K for fiscal 2026, filed Mar 13, 2026 · Apple 10-K for fiscal 2026, filed Nov 3, 2026
What it doesn't tell you
- Timing inside the year. The ratio is a snapshot of one day, the fiscal year end. Retailers often pick a year end just after the holidays, when inventory is low and cash is high.
- Which liabilities are due first. A dollar of supplier payables due in 60 days and a dollar of deferred revenue that will be earned by delivering a service count the same.
- Access to borrowing. Large companies with unused credit lines can meet short-term needs that the balance sheet alone doesn't show.
36 of the 63 companies in the table have a quick ratio below 1. That describes how the balance sheet is built, not whether a company can pay its bills.
Every company that reports inventory
From each company's balance sheet at its latest fiscal year end, sorted by quick ratio. Only companies that report an inventory line are included; for the rest the quick ratio as defined here equals the current ratio. Banks are left out.
Common questions
How do you calculate the quick ratio?
Subtract inventory from current assets and divide by current liabilities, all from the balance sheet. A stricter version uses only cash, short-term investments and receivables in the top half.
What is the difference between the quick ratio and the current ratio?
The current ratio uses all current assets. The quick ratio leaves out inventory, so it's always the same or lower.
Why is it called the acid-test ratio?
The name comes from the old acid test for gold. The ratio is the stricter test of whether short-term assets cover short-term liabilities.
Is a quick ratio below 1 a problem?
Not on its own. 36 of the 63 companies here are below 1, Walmart among them, because they sell inventory and collect cash before they pay suppliers.
Why are banks left out?
Bank balance sheets don't separate current from long-term items, so neither ratio applies to them.
Disclosures
- Editor holdings
- The editor holds shares of Tesla (TSLA) and SpaceX in a long-term retirement account. The editor holds no position in any other company named on this page. As of Nov 11, 2026.
- Compensation
- Nobody paid for this page. No affiliate links on this page.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Nov 9, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.