1. Balance sheet The balance sheet provides a snapshot of the financial condition of a company. Investors and analysts use the information given on the balance sheet and other financial statements to make several interpretations regarding the company's financial condition and performance. Blue Hamster Manufacturing Inc. is a hypothetical company. Suppose it has the following balance sheet items reported at the end of its first year of operation. For the second year, some parts are still incomplete. Use the Information given to complete the balance sheet. Blue Hamster Manufacturing Inc. Balance Sheet for Year Ending December 31 (Millions of dollars) Year 2 Year 1 Year 2 Year 1 Assets Liabilities and equity Current assets: Current liabilities: Cash and equivalents $3,690 Accounts payable $0 $0 Accounts receivable 1,688 1,350 Accruals 234 0 Inventories 4,950 3,960 Notes payable 1,328 1,250 Total current assets $11,250 $9,000 Total current liabilities $1,250 Net fixed assets: Long-term debt 4,688 3,750 Net plant and equipment $11,000 Total debt $6,250 $5,000 Common equity Common stock 12,188 9,750 Retained earnings 5,250 Total common equity $18,750 $15,000 Total assets $25,000 $20,000 Total abilities and equity $25,000 $20,000 Given the information in the preceding balance sheet-and assuming that Blue Hamster Manufacturing Inc. has 50 million shares of common stock outstanding-read each of the following statements, the identify the selection that best interprets the information conveyed by the balance sheet and other financial statements to make several interpretations regarding Blue Hamster Manufacturing Inc. is a hypothetical company. Suppose it h operation. For the second year, some parts are still incomplete. Use the i Blue Hamster Manufacturing Inc. Balance Sheet for Year Ending Year 2 Year 1 Assets Liabilities and Current assets: Current liabile Cash and equivalents $3,690 Accounts pay. Accounts receivable 1,350 Accruals $4,612 Inventories 3,960 Notes payable Total current assets $12,262 $9,000 Total current Net fixed assets: $11,610 Long-term del Net plant and equipment $11,000 Total debt Common equit Common stock Retained earni Total common Total assets $25,000 $20,000 Total liabilities Given the information in the preceding balance sheet-and assuming that Blu outstanding-read each of the following statements, then identify the selectie operation. For the second year, some parts are still incomplete. Us Blue Hamster Manufacturing Inc. Balance Sheet for Year E- Year 2 Year 1 Assets Liabilit: Curren $3,690 Accoun Current assets: Cash and equivalents Accounts receivable Inventories 1,688 1,350 Accrual 4,950 3,960 Notes p Total current assets $11,250 $9,000 Total cu Net fixed assets: Long-te Net plant and equipment $11,000 Total de Commor $13,750 Commor $5,000 Retained Total con Total assets $23,312 $ co $20,000 Total liab Given the information in the preceding balance sheet-and assumingt outstanding-read each of the following statements, then identify the any. Suppose it has the following balance sheet items reported at the mplete. Use the information given to complete the balance sheet. or Year Ending December 31 (Millions of Dollars) Year 2 Year 1 Liabilities and equity Current liabilities: Accounts payable $0 $0 Accruals 234 0 1,328 1,250 Notes payable Total current liabilities $1,250 Long-term debt 3,750 $2,343 Total debt $5,000 $312 $1,562 9,750 Common equity: Common stock Retained earnings Total common equity Total liabilities and equity 5,250 $18,750 $15,000 $25,000 $20,000 and assuming that Blue Hamster Manufacturing Inc. has 50 million shares en identify the selection that best interprets the information conveyed by th mpany. Suppose it has the following balance sheet items reported at the en complete. Use the information given to complete the balance sheet. for Year Ending December 31 (Millions of Dollars) 1 Year 2 Year 1 . $0 Liabilities and equity Current liabilities: Accounts payable Accruals Notes payable Total current liabilities $0 234 1,328 1,250 0 $1,250 Long-term debt 4,688 3,750 00 Total debt $6,250 $5,000 Common equity: Common stock 12,188 9,750 Retained earnings 5,250 Total common equity $15,000 6,562 00 Total liabilities and equity $20,000 5,250 -and assuming that Blue Hamster M ring Inc. has 50 million shares of a 9,843 en identify the selection that bestill the information conveyed by the b Chapter 3 Assignment outstanding-read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet. Statement #1: Blue Hamster's net collection of Inventory items increased by more than the firm's sales between Years 1 and 2 This statement is because: Total inventories of raw materials, work-in-process, and final goods increased from $3,960 million to $4,950 million between Year 1 and Year 2 Total inventories of raw materials, work-in-process, and final goods decreased by $990 million between Year 1 and Year 2 The accruals balance decreased by $234 million between Years 1 and 2 Statement #2: Over the past two years, Blue Hamster Manufacturing Inc. has relied more on the use of short-term debt than on long- term debt financing This statement is because: O Blue Hamster's total current liabilities increased by $312 million, while its use of long-term debt increased by $938 millon Blue Hamster's total current liabilitles decreased by $312 million, while its long-term debt account decreased by $938 millon O Blue Hamster's total notes payable increased by $78 million, while its common stock account increased by $2,438 million Statement #3: The book value per share of Blue Hamster's stock in Year 2 was $375.00 This statement is har Statement #3: The book value per share of Blue Hamster's stock in Year 2 was $375.00. This statement is because: The per correct value is calculated by dividing the company's total debt by the number of outstanding shares of common stock The per incorrect value is calculated by dividing the company's total assets by the number of outstanding shares of common stock The per-share book value is calculated by dividing the company's total common equity by the number of outstanding shares of common stock Based on your understanding of the different items reported in the balance sheet and the information they provide, which statement regarding Blue Hamster Manufacturing Inc.'s balance sheet is consistent with U.S. Generally Accepted Accounting Principles (GAAP)? The company's assets should be listed in the order in which they are to be converted into cash. The company's assets should be listed in alphabetical order. The company's assets should be listed from those carrying the largest balance to those with the smallest balance Given the information in the preceding balance sheet-and a outstanding-read each of the following statements, then id Statement #1: Blue Hamster's net collection of invento This statement is because: Total in incorrect raw materials, work-in-proces Year 2 correct O Total inventories of raw materials, work-in-proces The accruals balance decreased by $234 million be Statement #2: Over the past two years, Blue Hamster term debt financing. This Total inventories of raw materials, work-in-process, and fina Year 2 O Total inventories of raw materials, work-in-process, and fin= The accruals balance decreased by $234 million between Ye Statement #2: Over the past two years, Blue Hamster Manufact term debt financing. This statement is , because: Blue Har false total current liabilities increased by $312 mil O Blue Har true total current liabilities decreased by $312 mi Blue Hamster's total notes payable increased by $78 million, Statement #3: The book value per share of Blue Hamster's stock