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Groceries R Us, Inc

question 153

Essay

Groceries R Us, Inc. reported the following date in it's December 31, 2011 annual report.
Cash and cash equivalents $2,280,000
Cash flow from operations (240,000)
(1) What is the company's "cash burn" per month?
(2) What is the company's ratio of cash to monthly cash expenses?
(3) Interpret the ratio you computed in part 2. What are the implications for Groceries R Us, Inc.?


Definitions:

Proxy

An authority to act on behalf of another person in voting or making decisions.

Directors

Individuals appointed or elected to the board of a corporation who are responsible for overseeing and guiding the company's policies and decisions.

Directors

Individuals elected by shareholders to manage the corporation's affairs and make decision on major company issues.

Voting Trust

A legal arrangement where shareholders' voting rights are transferred to a trustee, typically to consolidate control over a company for a specific period.

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