2. 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. Cute Camel Woodcraft Company 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. Cute Camel Woodcraft Company 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 Accounts payable $0 $0 $3,690 1,350 Accounts receivable 1,688 Accruals 234 1,328 1,250 Inventories Total current assets 4,950 $11,250 3,960 $9,000 Notes payable Total current liabilities Long-term debt $1,250 Net fixed assets: 4,688 3,750 Net plant and equipment $11,000 $6,250 $5,000 12,188 9,750 Total debt Common equity: Common stock Retained earnings Total common equity Total liabilities and equity 5,250 $15,000 $20,000 $18,750 $25,000 Total assets Total assets $25,000 $20,000 Statement #1: Cute Camel's pool of relatively liquid assets, which are available to support the company's current and future sales, decreased from Year 1 to Year 2. his statement is , because: O Cute Camel's total current asset balance actually increased from $9,000 million to $11,250 million between Year 1 and Year 2 O Cute Camel's total current liabilities balance increased from $1,350 million to $1,688 million between Year 1 and Year 2 O Cute Camel's total current liabilities balance decreased by $2,250 million between Year 1 and Year 2 Statement #2: Over the past two years, Cute Camel Woodcraft Company has relied more on the use of short-term debt than on long- term debt financing. This statement is , because: O Cute Camel's total current liabilities decreased by $312 million, while its long-term debt account decreased by $938 million O Cute Camel's total notes payable increased by $78 million, while its common stock account increased by $2,438 million O Cute Camel's total current liabilities increased by $312 million, while its use of long-term debt increased by $938 million Statement #3: If Cute Camel ever goes bankrupt, its common stockholders will be paid off first, then its debtholders and preferred stockholders. This statement is - , because: O Debtholders and preferred shareholders are considered residual investors O Common shareholders are treated as residual investors Debtholders are treated as residual investors Based on your understanding of the different items reported on the balance sheet and the information they provide, which statement regarding Cute Camel Woodcraft Company's balance sheet is consistent with U.S. Generally Accepted Accounting Principles (GAAP)? O The company's debts should be listed in order of their liquidity. O The company's debts should be listed from those carrying the largest balance to those with the smallest balance. The company's debts are listed in the order in which they are to be repaid