Parks and Recreation department considers new applications for the provider of summer free lunch service served through its 26 community centers. The goal of the department is not only to support the best nutrition options for children and youth initiative, but to also to select providers that are in good financial standing. Two providers have applied for the tender. Their financials are as follows:

The task: Compare and contrast financial standing of each provider based on the information contained in the balance sheets and activity statements. Do not calculate the financial ratios to answer this question: provide only your general observations about the financial condition. Which organization appears to have stronger financials? Why? Support your arguments with specific numbers cited from the Statement of Activities and the Statement of Financial Position.

Eat Your Veggies Balance Sheet as of December 31, 2020 in USD Assets Liabilities Short-Term Assets Accounts Payable Cash 2,000 Wages Payable Accounts Receivable 12,200 Short-Term Debt Grants Receivable 1,000 Long-Term Debt Total Liabilities Long-Term Assets Buildings, Property, Plant and Equipment 0 Net Assets Investments in Equity of a Subsidiary 23,000 Net Assets Total Assets 38,000 Total Net Assets 20,000 8,000 8,000 0 28,000 2,000 38,000 Eat Your Veggies Statement of Activities for the year ended December 31, 2020, in USD Program Revenues 15,000 Contributions from Grants 2,000 Total Revenues 17,000 Program Expenses 12,000 Overhead Expenses 3,400 Interest Expense 600 Operating Expenses 16,000 Change in Net Assets from Operations 1,000 Other Non-Operating Expenses 500 Total Expenses 10,500 Change in Net Assets (Net Income/Loss) 500 Zuppa Di Giorno Balance Sheet as of December 31, 2020, in USD Assets Liabilities Short-Term Assets Accounts Payable Cash 17,200 Wages Payable Accounts Receivable 10,500 Short-Term Debt Grants Receivable 10,500 Long-Term Debt Total Liabilities Long-Term Assets Buildings, land and equipment 0 Net Assets Reserves 16,000 Net Assets Total Assets 54,200 Total Net Assets 10,000 5,050 10,000 5,000 30,050 24,150 24,150 Operating Expenses Change in Net Assets from Operations Other Non-Operating Expenses Change in Net Assets (Net Income/Loss) 32,000 30,000 1,000 29,000