Acid-test ratio

Working-Capital Ratios Financial analysts make extensive use of ratios in assessing the economic health of a company. For evaluating the ability of a company to successfully maintain and develop its immediate business activities, analysts apply a current ratio and a quick (or acid-test) ratio, as given by... 

Only the most liquid of assets are included in this ratio, and the best ratio is usually 1 1, but this varies with the industry concerned. Table 9.12 calculates the acid-test ratio. Although the Blue company has a better current ratio than the Gold company, it does not have a better acid-test ratio, and, therefore, may have to sell its inventory at discounted prices in order to raise cash for current debt that is due. The Gold company, which did not have a favorable current ratio, does have an acceptable acid-test ratio because most of its current assets are in cash, accounts receivable, and marketable securities. 

Although working capital, the current ratio, and the acid-test ratio are effective ways to analyze a firm s liquidity, they should not be the only tools employed. The statement of cash flows is as viable as these ratios for analyzing liquidity. 

The acid-test ratio, also called the quick ratio, is a modification of the current ratio with the aim of obtaining a better measure of the liquidity of a company. In place of current assets, only assets readily convertible to cash, called quick assets, are used. Thus, it is defined as the ratio of current assets minus inventory to current liabilities. Marketable securities, accounts receivable, and deferred income tax assets are considered to be part of quick assets. From Table 16.3, the quick assets for U.S. Chemicals, in millions of dollars, is 4,630 - 1,420 -312 = 2,898. This gives an acid-test ratio of 2,898/4,153 = 0.70, which is not a desirable ratio, since it is less than one. At the end of the year 2000, Monsanto Company had a much better acid-test ratio of 1.35. 

The quick ratio, sometimes called the acid test ratio, is similar to the current ratio, except that inventories are removed from the calculation. Without considering inventory, the quick ratio becomes more conservative than the current ratio. Inventory is the least liquid of current assets and is much more difficult to turn into cash than marketable securities or receivables. One factor to consider with the... 

Ratios well below 1 may indicate financial problems ahead while those substantially greater than 1 may point to poor credit control or under-utilization of cash. This ratio is sometimes known as the acid test . The principal profitability ratio in use is the net profit before interest and tax (NPBIT) to net assets or return on capital employed. 

Nitric-hydrofluoric acid test 1 10% HNO3 -1- 3% HF 4 h exptosure to 70° C solution Comparison of ratio of mass loss of laboratory annealed and as-received samples of same material Corrosion potential of 304 steel = -l-O-14 to -I-0-54 1. Chromium-depleted areas 2. Not for 0-phase 3. Used only for Mo-bearing steels... 

Acid Chloride Ratio Reverse Osmosis Test Results ... 

Triflic acid has been used in the selective esterification ( (9-acylation) of a series of aminoalcohols in the presence of a crown ether (DB24C8) to prepare rotaxanes.900 The test reaction of diethanolamine with bulky anhydride, crown ether, and triflic acid (molar ratio = 1 2 2 1.5) gave the rotaxane 276 in high yield in a clean reaction [Eq. (5.327)]. /V-Arylmethylaminoalcohols were similarly transformed (85-92% yields). 

An alternative to the current ratio is the quick ratio (also known as the acid test). For this ratio, quick assets are defined as assets that are easily converted to cash. Therefore, inventories and prepaid expenses (such as prepaid rent and insurance policies) are not included in calculating assets. Because the quick ratio considers only assets that are easily converted to cash (and therefore can be used to pay bills, etc.), it provides a better picture of a company s liquidity and its ability to meet its financial obligations. 

In France the lead block performance value is given by the coefficient d utilisation pratique (c. u. p.) if mx is the mass of the tested explosive, which gives exactly the same excavation as 15 g of picric acid, the ratio... 

In this Investigation, acid was rather slowly added to the Isobutane-olefin mixture. By the time sufficient acid was added to obtain an acid/olefin (A/0) molar ratio of about 1.2, all olefins had been removed from the hydrocarbon phase. While the acid was being added, acid droplets were well dispersed because of vigorous agitation throughout the hydrocarbon phase. Acids tested were 92.5 to 98% fresh acid (water being the only Impurity) and both Amoco and Sohio used alkylation acids. When 98% fresh acid was used, part of the acid Initially froze and deposited on the walls of the reactor. Gradually, the frozen acid disappeared presumably because It reacted to form butyl sulfates. 

Figure 3 shows a plot of olefin conversions after equilibrium had been obtained versus A/0 ratios in the feed. The conversion results were essentially identical for all n-butenes and for all sulfuric acids tested. More than 10-30% excess sulfuric acid was needed to produce butyl sulfate (and also to cause olefin isomerization). 

Alfhough the current ratio is valuable, an organizahon may wish to go further to evaluate liquidity. The acid-test or quick ratio is a means to consider only the most liquid of fhe currenf assets and determine whether the firm can pay its short-term debt even more quickly. The formula for the quick ratio is ... 

Some degradation products are either very polar or very nonpolar in nature this may present an issue in chromatography, where they may not be retained or strongly adsorbed on the column, respectively. One may also want to double check the reference standard for its purity, moisture content, and/or salt/ acid-base ratio for calculation. An analytical chemist must remember to explore all possibilities if mass balance issue is observed (either during method development, validation and/or stability testing). 

Figure 19.5 shows the color changes and their pH ranges for some common acid-base indicators. Selecting an indicator requires that you know the approximate pH of the titration end point, which in turn requires that you know which ionic species are present. Because the indicator molecule is a weak acid, the ratio of the two forms is governed by the [H30" ] of the test solution ... 

Acid test or quick ratio = (current asset inventories)/current liabilities... 

As shown in Fig. 1, photooxidation of LHC-bound Chl-a at pH 7.8 and pheophytin formation of LHC-bound Chl-a at pH 1.3 are hardly enhanced by fatty acids of 6 to 12 carbon atoms, whereas fatty acids of 14 to 18 carbons accelerate these reactions significantly. Within the Cj g fatty acids tested, desaturation improves the ability of the acids to destroy photo- and acid stability of the LHC. These results do not appear to be explained simply by differences in the partitioning of the different fatty acids between lipophilic LHC and aqueous solvent. Namely, while the molar solubility of saturated fatty acids in both, lipophilic cyclohexane and water decreases by a factor of 20 for acids from 12 to 18 carbons, the solubility ratio for either fatty acid in these solvents changes only slightly (calculated from Ref. 4). 

DL data have been plotted in Fig. 17 as a function of corrosion rates in the ASTM standard ferric sulfate test and the classifications obtained in the oxalic acid etch test. They show that the current ratio is very sensitive for detecting the absence of sensitization and for differentiating mild degrees of sensitization for which the oxalic acid test shows step or dual structures. Current ratios are in the range of 0.0001-0.001 for step structures and between 0.001-0.05 for dual structures. Corrosion rates in the ferric sulfate test do not differentiate between these small levels of sensitization, However, for severely sensitized materials with ditch structures, current ratios become less effective in making distinctions between medium and severe levels of sensitization, while the corrosion rates vary over a wide range. These specimens have DL ratios in a wide band extending from 0.05-0.3. 

The leaves, flowers, and stems of Satureja hortensis (summer savory, Lamiaceae), a common plant widely spread in Turkey, are used as tea or as addition to foods on account of the aroma and the flavor. As a medical plant it is known for its antispasmodic, antidiarrheal, antioxidant, sedative, and antimicrobial properties. Also this EO was investigated for its antioxidative properties. The GC-MS analysis showed that besides 9% p-cymene, carvacrol and thymol are the main compounds of about 22 constituents of the oil. They occur at a ratio of approximately 1 1, which is representative for the genus Satureja, namely 29% of thymol and 27% of carvacrol. In a linoleic acid test system the EO showed an inhibition activity of 95%, this is an indicator for a strong antioxidative activity because the control BHT attained an inhibition of 96% (Giilliice et al., 2003). Thymol is one of the main components of the EO from Satureja montana L ssp. montana (savory) and also one of the glycosidically bound volatile aglycones that were found. The EO with 45% thymol shows a very strong antioxidative capacity that was a bit lower than the standards, BHT, and a-tocopherol. The... 

---