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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

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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 Current assets: Cash and equivalents Accounts receivable $0 $0 352 0 2,531 7,425 $16,875 $5,535 2,025 5,940 $13,500 1,992 Inventaries Total current assets Net fixed assets: Net plant and equipment Liabilities and equity Current liabilities: Accounts payable Accruals Notes payable Total current liabilities Long-term debt Total debt Common equity Common stock Retained earnings Total common equity Total liabilities and equity 1.875 $1,875 5,625 $7,500 7,031 $16,500 $9,375 18,281 14,625 $28,125 $37,500 7.875 $22,500 $30,000 Total assets $37,500 $30,000 Given the information in the preceding balance sheet-and assuming that Cute Camel Woodcraft Company has 50 million shares of common stock outstanding-read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet 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 This statement is because O Cute Camel's total current liabilities balance decreased by $3,375 million between Year 1 and Year 2 o cute Camel's total current liabilities balance increased from $2,025 million to $2,531 million between Year 1 and Year 2 Cute Camel's total current asset balance actually increased from $13,500 million to $16,875 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 notes payable increased by $117 million, while its common stock account increased by $3,656 million Cute Camel's total current liabilities increased by 5469 million, while its use of long-term debt increased by 51,406 million Cute Camel's total current liabilities decreased by $469 million, while its long-term debt account decreased by $1,406 million Statement #3 The book value per share of Cute Camel's stock in Year 2 was $562.50. This statement is because The per share book 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 debt by the number of outstanding shores of common stock The per shore 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 on the balance sheet and the information they provide, which statement regarding Cute Camel Woodcraft Company's balance sheet is consistent with U.5. Generally Accepted Accounting Principles (GAAP)? 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, The company's debts should be listed in order of their liquidity

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