The correct answer is: B. Quick Assets : Current Liabilities
The acid test ratio, also known as the quick ratio or the liquidity ratio, is a measure of a company’s ability to pay off its short-term debts with its most liquid assets. It is calculated by dividing a company’s quick assets by its current liabilities.
Quick assets are a company’s most liquid assets, which means they can be converted into cash quickly and easily. They include cash, short-term investments, and accounts receivable. Current liabilities are a company’s short-term debts, which must be paid within one year.
A high acid test ratio indicates that a company has a good ability to pay off its short-term debts. A low acid test ratio indicates that a company may have difficulty paying off its short-term debts.
Option A, Current Assets : Current Liabilities, is the current ratio. The current ratio is a measure of a company’s ability to pay off its short-term debts with its current assets. It is calculated by dividing a company’s current assets by its current liabilities.
Option C, Total Assets : Total Liabilities, is the debt-to-equity ratio. The debt-to-equity ratio is a measure of a company’s financial leverage. It is calculated by dividing a company’s total debt by its total equity.
Option D, Fixed Assets : Fixed Liabilities, is not a common financial ratio.