An acid ratio, also referred to as an acid test liquidity, acts as a guide to indicate whether a business has sufficient liquid resources to meet its current liabilities. It is calculated as (Current Assets + Stock) ÷ Current Liabilities. If the Acid Ratio is less than 1 there could be a concern.
Top tips on managing your cash flow effectively
An essential part of every business; let us work it out for you
8 steps to stay in control of the cash flow in your business
Get greater insight to make quick and informed business decisions
©2025 Experian Information Solutions, Inc. All rights reserved.
Experian Ltd is authorised and regulated by the Financial Conduct Authority (firm reference number 738097). Experian Ltd is registered in England and Wales (no. 00653331). Registered office: The Sir John Peace Building, Experian Way, NG2 Business Park, Nottingham NG80 1ZZ.