Indigo Books & Music Inc., Canada’s largest book, gift, and specialty toy retailer, operates throughout Canada and online at www.chapters.indigo.ca. Indigo reported the following financial data (in thousands) for the year ended March 31, 2012:
Net cash flows from operating activities ..... $(12,493)
Cash and cash equivalents, March 31, 2012 ... 207,601
a. Determine the monthly cash expenses.
b. Determine the ratio of cash to monthly cash expenses. Round to one decimal place.
c. Based on your analysis, do you believe that Indigo will remain in business?