Farm Store, Inc $\begin{array}{lc}\text { Cash and cash equivalents } & \$ 1,050,000 \\\text { Negative cash flow from operations } & (420,000)\end{array}$

question 139

Essay

Farm Store, Inc. reported the following data in its December 31 annual report.​ $\begin{array}{lc}\text { Cash and cash equivalents } & \$ 1,050,000 \\\text { Negative cash flow from operations } & (420,000)\end{array}$ Required
(a) What is the company's "cash burn" per month?
(b) What is the company's ratio of cash to monthly cash expenses?
(c) Interpret the ratio you computed in part
b. What are the implications for Farm Store, Inc.?

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Stress Response

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