Lucas Company Has Provided the Following Information

question 101

Multiple Choice

Lucas Company has provided the following information:
• Cash flow from operating activities,$360,000
• Net income,$306,000
• Interest expense,$30,000
• Interest cash payments,$20,000
• Income tax payments,$240,000
• Income tax expense,$246,000
-
What was Lucas' quality of income ratio?

• A)0.85
• B)0.74
• C)1.18
• D)0.93

---

Definitions:

Mortgage

A transfer of an interest in property for the purpose of creating a security for a debt.

Partnership Property

Assets purchased or acquired for the purpose of the partnership business, jointly owned by all partners according to the partnership agreement.

Legal Position

The stance or argument taken on a legal issue, often based on laws, precedents, and principles.

Partnership

A legal form of business operation between two or more individuals who share management and profits.