The balance sheet provides a snapshot of the financial condition of 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 balarice 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 Companv Balance Sheet for Vas. c............... Given the information in the preceding balance sheet-and assuming that Cute Camel Woodcraft Company has 50 miltion 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 coliection of inventory items increased by more than the firm sold between Years 1 and 2 . Statement \#1: Cute Camel's net collection of inventory items increased by more than the firm sold between Years 1 and 2 . This statement is , because: The accounts recelvable balance increased by $253 million between Years 1 and 2 . Total inventories of raw materials, work-in-process, and final goods increased from $2,970 million to $3,712 million between Year 1 and Year 2 . Total inventories of raw materials, work-in-process, and final goods decreased by $742 million between Year 1 and Year 2 . Statement 2 : On December 31 of Year 2, Cute Camel Wooderaft Company had $3,459 million of actual money that it could have spent immediately. This statement is , because: Cute Camel's Year 2 cash and equivalents balance is $8,707. The funds recorded in Cute Camel's cash and equivalents account represents funds that are either cash or can be converted into cash almost immediately. The funds recorded in Cute Camel's accounts receivable account represents funds thot are either cash or can be converted into cash almost immediately. Statement \#3: If Cute Comel ever goes bankrupt, its common shareholders will be paid off first, then its debtholders and preferred stockholders. This statement is , because: Debtholders are treated as residual investors. Debtholders and preferted shareholdars sre constdered residual investors. Common shareholders are treated os residual investors