For the last question, options are increase/decrease/remain the same

. Balance sheet The balance sheet provides F the financial condition of company. Investors and analysts use the information given on the balance sheet snapshot 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 CompanyBalance Sheet for Year Ending December 31 (Millions of Dollars) Year 2 Year 2 Year 1 Year 1 Liabilities and equity Assets Current liabilities: Current assets: Accounts payable Cash and equivalents $5,535 $0 Accounts receivable Accruals 0 2,531 2,025 352 7,425 Notes pavable Inventories 5.940 1.992 1.875 c6407fe-8 b69-4f6..pq Ch 03: Assignment - Financial Statements, Cash Flow, and Taxes Cute Camel Woodcraft CompanyBalance Sheet for Year Ending December 31 (Millions Dollars) Year 2 Year 1 Year 2 Year 1 Liabilities and equity Assets Current assets: Current liabilities: Cash and equivalents Accounts payable $5,535 $0 $0 Accounts recelvable 2,531 2,025 Accruals 352 0 Notes payable 1,992 Inventories 7,425 5,940 1,875 Total current assets Total current llablitles $16,875 $13,500 $1,875 Net fixed assets: 5,625 Long-term debt 7,031 $9,375 Net plant and equlpment $16,500 Total debt $7,500 Common equity: Common stock 18,281 14.625 Retained earnings 7,875 Total common equity $28,125 $22.500 Total assets Total liabilities and equity $37,500 $30,000 $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 selectlon that best Interprets the Information conveyed by the balance sheet 9c6407fe-8b69-4f6. jpg^ Statement #1:Cute Camel's net collection f inventory items increased by more than the firm sold between Years 1 and 2. This statement is because: Total inventorles of raw materlals, work-in-process, and final goods Increased from s5,940 million to s7.425 mllon between Year 1 and Year 2 The accruals balance decreased by $352 million between Years and 2 Total inventories of raw materials, work-in-process, and final goods decreased by $1,485 million between Year 1 and Year 2 Statement #2 : In Year 2 , Cute Camel Woodcraft Company was profitable. 9c6407fe 8b69 4f6pg Statement #2: In Year 2, Cute Camel Woodcraft Company was profitable. because: This statement is Cute Camel's total assets increased between Years 1 and 2 The cash and equivalents account increased between Years 1 and 2 Cute Camel's retained earnings account increased between the end of Years 1 and 2 Statement #3: One way to interpret the change in Cute Camel's accounts receivable balance from Year 1 to Year 2 that more customers purchased new items on credit rather than paying off existing credit accounts. 9c6407fe-8b69-4f6..pg Statement # 3 : One way to interpret the change in Cute Camel's accounts receivable balance from Year 1 to Year 2 is that more customers purchased new items on credit rather than paying off existing credit accounts. This statement is because The decrease from $2,531 million to $2,025 million implies a net decrease in accounts receivable and that more customers are paying off their receivables balances than are buying on credit The change from $5,940 million to $7,425 million reflects a net accumulation of new credit sales The $506 increase in accounts receivable means either that Year 1s existing credit customers are not paying off their owed balances and new or existing customers are making additional purchases on credit, or that Year 1's credit customers have repaid their owed balances and Year 2 credit sales have exceeded Year 1's credit sales Based on your understanding of the different items reported on the balance sheet and the Information they provide, If everything else remains the likely to if the firm increases the dividends paid on same, then the cash and equivalents item on the current balance sheet Its common stock. 9c6407fe-8b69-4f6.jpg