What are Net Quick Assets?

Net quick assets are the aggregate amount of a firm’s cash, marketable securities, receivables, and current liabilities. The measure excludes inventory, which can be difficult to liquidate within a short period of time. Net quick assets can be used to gain an understanding of an organization’s ability to settle short-term obligations with assets that are easily convertible into cash.

How to Calculate Net Quick Assets

Net quick assets is calculated as all unrestricted cash, trade receivables, and marketable securities, minus current liabilities. Restricted cash should not be included, since it has been set aside for some purpose that renders it unusable for the payment of current liabilities. All securities included in the calculation should be readily sellable in an active market; otherwise, they will not be available to pay off current liabilities. Finally, do not include non-trade receivables in the calculation, since these items may have long collection periods. The resulting formula is:

Unrestricted cash + Marketable securities + Trade receivables - Accounts payable = Net quick assets