The Quick Ratio, sometimes referred to as the Acid Test, is a financial metric that measures a company’s ability to meet its short-term obligations. It quantifies the amount of liquid assets within a firm relative to the amount of current liabilities. A low quick ratio can be an indication of liquidity problems, as it implies that a firm may not have enough cash or easily converted assets on hand to pay its bills in the short-term. Thus, companies should strive for a quick ratio above 1, showing that they have enough liquid assets to meet their current liabilities.