HyperSpace Communications Inc. engages in the development, manufacture, and marketing of network acceleration and data compression software worldwide. Its software products speed up the delivery of information over computer networks, including the Internet, wireless, broadband, private, and dial-up networks. HyperSpace reported the following data (in thousands) for the years ending December 31:

a. Determine the monthly cash expenses for 2004 and 2003. Round to one decimal place.
b. Determine the ratio of cash to monthly expenses for December 31, 2004 and 2003. Round to one decimal place.
c. Based upon (a) and (b), why do you think HyperSpace€™s cash to monthly expenses ratio improved so much by the end of2004?

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2004 2003 Net cash flows from operating actiities (2,558) ($624) 27 Cash, December 31 5,875