Lee Company has provided the following information:
Cash flow from operating activities,$240,000;
Net income,$204,000;
Interest expense,$20,000;
Interest cash payments,$10,000;
Income tax payments,$140,000;
Income tax expense,$136,000.
What was Lee's times interest earned ratio?
A)39.0
B)18.0
C)35.4
D)17.7

Question

Lee Company has provided the following information:
 Cash flow from operating activities,$240,000;
 Net income,$204,000;
 Interest expense,$20,000;
 Interest cash payments,$10,000;
 Income tax payments,$140,000;
 Income tax expense,$136,000.
What was Lee's times interest earned ratio?
A)39.0
B)18.0
C)35.4
D)17.7

Quizplus · Accepted Answer

Times interest earned ratio (39.0) = [Net income ($204,000) + Interest expense ($20,000) + Income tax expense ($136,000)] F1F1F1S1?F1F1F10 Interest expense ($20,000)

Lee Company Has Provided the Following Information