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$)$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.

$3$ased on your understanding of the different items reported on the balance sheet and the information they provide, which statement regarding Cute

Zamel Woodcraft Company's balance sheet is consistent with U$.$S$.$ Generally Accepted Accounting Principles $($GAAP$)?$

The company's debts should be listed in order of their liquidity.

The company's debts are listed in the order in which they are to be repaid.

The company's debts should be listed from those carrying the largest balance to those with the smallest balance.

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 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 $$5,940$ million to $$7,425$ million between Year $1$ and

Year $2$

Total inventories of raw materials, work$-$in$-$process, and final goods decreased by $$1,485$ million between Year $1$ and Year $2$

The accruals balance decreased by $$352$ million between Years $1$ and $2$

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:

Statement #$3$: The book value per share of Cute Camel's stock in Year $2$ was $$562\mathrm{.}50.$

This statement is

$\_,$ because:

The per$-$share book value is calculated by dividing the company's total common equity by the number of outstanding shares of common

stock

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 shares of common stock