Green Caterpillar Garden Supplies 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.

Given the information in the preceding balance sheet$$and assuming that Green Caterpillar Garden Supplies Inc. has $50$ million shares of common stock outstanding$$read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet.

Statement #$1$: Green Caterpillar$$s pool of relatively liquid assets, which are available to support the company$$s current and future sales, decreased from Year $1$ to Year $2.$

This statement is $($correct$/$incorrect$),$ because:

$-$ Green Caterpillar$$s total current asset balance actually increased from $$15,750$ million to $$19,687$ million between Year $1$ and Year $2$

$-$ Green Caterpillar$$s total current liabilities balance decreased by $$3,937$ million between Year $1$ and Year $2$

$-$ Green Caterpillar$$s total current liabilities balance increased from $$2,363$ million to $$2,953$ million between Year $1$ and Year $2$

Statement #$2$: On December $31$ of Year $2,$ Green Caterpillar Garden Supplies Inc. had $$8,072$ million of actual money that it could have spent immediately.

This statement is $($false$/$true$),$ because:

$-$ The funds recorded in Green Caterpillar$$s cash and equivalents account represents funds that are either cash or can be converted into cash almost immediately

$-$ The funds recorded in Green Caterpillar$$s accounts receivable account represents funds that are either cash or can be converted into cash almost immediately

$-$ Green Caterpillar$$s Year $2$ cash and equivalents balance is $$20,317$

Statement #$3$: If Green Caterpillar ever goes bankrupt, its common stockholders will be paid off first, then its debtholders and preferred stockholders.

This statement is $($incorrect$/$correct$),$ because:

$-$ Debtholders are treated as residual investors

$-$ Debtholders and preferred shareholders are considered residual investors

$-$ Common shareholders are treated as residual investors

Based on your understanding of the different items reported on the balance sheet and the information they provide, if everything else remains the same, then the cash and equivalents item on the current balance sheet is likely to $($increase$,$ decrease, remain the same$)$ if the firm issues $$3$ million of new common stock.