The range of allowable acid test ratios varies by sector. But, the acid-test ratio needs to be more than one in most sectors. If less than one, the company doesn't have enough liquid assets to cover its existing liabilities, and therefore should be avoided. If the acid-test ratio is significantly lower than the actual ratio, net assets heavily rely on inventories. Also, if your acid test ratio is below one, it generally means that your firm does not have enough accessible assets to cover its present creditors.