Laser Performance Inc. has the following information available (amount in thousands). $$\begin{array} { l r }
\text { Net Income } & \$ 30,000 \
\text { Average Total Liabilities } & 80,000 \
\text { Average Current Liabilities } & 36,000 \
\text { Cash Provided by Operations } & 48,000 \
\text { Cash Sales } & 130,000 \
\text { Capital Expenditures } & 22,000 \
\text { Dividends Paid } & 6,000
\end{array}$$ What is the current cash debt coverage?
A) 1.333 times.
B) .600 times .
C) .833 times .
D) .369 times.

Question

Laser Performance Inc. has the following information available (amount in thousands). $$\begin{array} { l r } 
\text { Net Income } & \$ 30,000 \
\text { Average Total Liabilities } & 80,000 \
\text { Average Current Liabilities } & 36,000 \
\text { Cash Provided by Operations } & 48,000 \
\text { Cash Sales } & 130,000 \
\text { Capital Expenditures } & 22,000 \
\text { Dividends Paid } & 6,000
\end{array}$$ What is the current cash debt coverage?
A) 1.333 times.
B) .600 times .
C) .833 times .
D) .369 times.

Quizplus · Accepted Answer

The current cash debt coverage is calculated as Cash Provided by Operations divided by Average Current Liabilities. Here, it is $48,000 / $36,000 = 1.333 times.

Laser Performance Inc What Is the Current Cash Debt Coverage? A) 1

Laser Performance Inc What Is the Current Cash Debt Coverage?
A) 1