Question

In: Accounting

Cash to Monthly Cash Expenses Ratio Amicus Therapeutics, Inc., is a biopharmaceutical company that develops drugs...

Cash to Monthly Cash Expenses Ratio

Amicus Therapeutics, Inc., is a biopharmaceutical company that develops drugs for the treatment of various diseases, including Parkinson’s disease. Amicus Therapeutics reported the following financial data (in thousands) for three recent years:

For Years Ended December 31
Year 3 Year 2 Year 1
Cash and cash equivalents $11,760 $21,300 $37,310
Net cash flows from operations (28,800) (36,000) (49,200)

a. Determine the monthly cash expenses for Year 3, Year 2, and Year 1 (in thousands).

Year 3: $ per month
Year 2: $ per month
Year 1: $. per month

b. Determine the ratio of cash to monthly cash expenses for Year 3, Year 2, and Year 1 as of December 31. Round to one decimal place.

Year 3: months
Year 2: months
Year 1: months

c. Based on (a) and (b), which of the following statements is correct.

1. Amicus has been able to support its operations by issuing additional stock. However, its negative cash flows have increased from Year 1 to Year 3.
2. Amicus has been able to support its operations generating positive cash flows. Its positive cash flows have increased from Year 1 to Year 3.
3. Amicus has been able to support its operations generating positive cash flows. However the cash flows generated are used to purchase short term investment.

Solutions

Expert Solution


Related Solutions

Cash to Monthly Cash Expenses Ratio Action Therapeutics, Inc., reported the following financial data (in thousands)...
Cash to Monthly Cash Expenses Ratio Action Therapeutics, Inc., reported the following financial data (in thousands) for the years ending December 31, Year 3, Year 2, and Year 1. For Years Ending December 31 Year 3 Year 2 Year 1 Cash and cash equivalents $30,600 $17,040 $10,200 Net cash flows from operations (40,800) (28,800) (24,000) a. Determine the monthly cash expenses for Year 3, Year 2, and Year 1 (in thousands). Year 3: $ per month Year 2: $ per...
The monthly incomes of two persons are in the ratio 9 : 7 and their expenses are in the ratio of 4 : 3. If each of them saves $200 per month, find their monthly incomes?
The monthly incomes of two persons are in the ratio 9 : 7 and their expenses are in the ratio of 4 : 3. If each of them saves $200 per month, find their monthly incomes?
A pharmaceutical company develops drugs to increase apoptosis in cancer cells. Each candidate drug is tested...
A pharmaceutical company develops drugs to increase apoptosis in cancer cells. Each candidate drug is tested in mice, using an experiment design that has 90% power at a = 1%. 1) For every 1000 drugs that have no real effect, about how many will the company mistakenly conclude work? 2) For every 1000 drugs that actually work, about how many will the company correctly conclude work?
question 1 - Salt Corporation's contribution margin ratio is 70% and its fixed monthly expenses are...
question 1 - Salt Corporation's contribution margin ratio is 70% and its fixed monthly expenses are $50,000. Assume that the company's sales for May are expected to be $109,000. Required: Estimate the company's net operating income for May, assuming that the fixed monthly expenses do not change. question 2- Fern Corporation manufacturers a single product that has a selling price of $20.00 per unit. Fixed expenses total $42,000 per year, and the company must sell 6,000 units to break even....
Creswell Corporation's fixed monthly expenses are $29,000 and its contribution margin ratio is 56%. Assuming that...
Creswell Corporation's fixed monthly expenses are $29,000 and its contribution margin ratio is 56%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $95,000? Multiple Choice $53,200 $66,000 $12,800 $24,200
Gama-Smith, a pharmaceutical company, develops new drugs for COVID-19 with other pharmaceutical companies that have the...
Gama-Smith, a pharmaceutical company, develops new drugs for COVID-19 with other pharmaceutical companies that have the appropriate production facilities. When Gama-Smith acquires a stake in a development project, it makes an initial payment to the other pharmaceutical company. It then makes a series of further stage payments until the drug development is complete and it has been approved by the relevant authorities. In the financial statements for the year ended 30 June 2019, Gama-Smith has treated the different stakes in...
The financial statements for Tyler​ Toys, Inc.  Calculate the current​ ratio, quick​ ratio, and cash ratio...
The financial statements for Tyler​ Toys, Inc.  Calculate the current​ ratio, quick​ ratio, and cash ratio for Tyler Toys for 2013 and 2014. Should any of these ratios or the change in a ratio warrant concern for the managers of Tyler Toys or the​ shareholders? Tyler Toys, Inc. Income Statement for Years Ending December 31, 2013 and 2014 2014 2013 Revenue $14,147,946 $13,566,699 Cost of goods sold $-8,447,605 $-8,132,285 Selling, general, and administrative expenses $-997,233 $-980,532 Depreciation $-1,497,455 $-1,472,391 EBIT...
Childish Inc. (the "Company") is a unionized toys company with 1,100 employees that develops and sells...
Childish Inc. (the "Company") is a unionized toys company with 1,100 employees that develops and sells children's toys in North America. The Company's factories and offices are located in Ontario and the Company is an Ontario-regulated corporation. The union was certified on January 20, 2020 to represent the Company's entire workforce. The union and the management entered into negotiations which are not going very well. The management started with a request to decrease wages by 3.5% explaining this is necessary...
The monthly incomes of two persons are in the ratio 4 : 5 and their monthly expenditures are in the ratio 7 : 9
 The monthly incomes of two persons are in the ratio 4 : 5 and their monthly expenditures are in the ratio 7 : 9. If each saves 50 per month, find their monthly incomes.
Assets = Liab. + Equity Rev. − Expenses = Net Inc. Cash Flow A. (3,375 )...
Assets = Liab. + Equity Rev. − Expenses = Net Inc. Cash Flow A. (3,375 ) = 3,375 + NA NA − NA = NA NA B. (3,375 ) = NA + (3,375 ) NA − 3,375 = (3,375 ) NA C. 3,375 = NA + 3,375 NA − (3,375 ) = 3,375 3,375 OA D. NA = NA + NA NA − NA = NA NA On December 31, Year 1, the Loudoun Corporation estimated that 3% of its...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT