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Describe a simple barometer and how it works.
Acid-Test Ratio
A stringent indicator of a company's liquidity, calculating if it can meet its short-term obligations with its most liquid assets, excluding inventory.
Accounts Receivable
Accounts Receivable is the money owed to a company by its customers for goods or services that have been delivered but not yet paid for.
Accounts Payable
Liabilities or money owed by a business to its suppliers or creditors for goods or services received.
Price-Earnings Ratio
A valuation ratio of a company's current share price compared to its per-share earnings.
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