The Following Information Was Taken from the Annual Report of Leno

The following information was taken from the annual report of Leno Inc.
$$\begin{array} { | l | l | c | } \hline & \mathbf { 2 0 1 7 } & \mathbf { 2 0 1 6 } \\\hline \text { BALANCE SHEET } & & \\\hline \text { Deferred incame tax liability } & \mathbf { \$ 5 8 , 3 0 0 } & \mathbf { \$ 5 9 , 4 0 0 } \\\hline & & \\\hline \text { INCOME STATEMENT } & & \\\hline \text { Incame befare taxes } & \$ 109,000 & \\\hline \text { Incame tax expense } & ( 40,400 ) & \\\hline \text { Net incame } & \mathbf { \$ 6 7 , 6 0 0 } & \\\hline \text { Effective incame tax rate } 35 \% & & \\\hline\end{array}$$
What is Leno's conservatism ratio?

A) 0.63
B) 0.91
C) 0.69
D) 0.86