The batance 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. Cold Goose Metal Works 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. Cold Goose Metal Works Inc. Balance Sheet for Year Ending December 31 (Millions of dollars) Year 2 Year 1 Year 2 Year 1 Assets Liabilities and equity Current assets: Current liabilities: Cash and equivalents $4,612 Accounts payable $0 $0 Accounts receivable 2,109 1,688 Accruals 293 0 Inventories 6,187 4,950 Notes payable 1,660 1,562 Total current assets $14,062 $11,250 Total current liabilities $1,562 Net fixed assets: Long-term debt 5,859 4,688 Net plant and equipment $13,50 Total debt $7,812 $6,250 Common equity Common stock 15,235 12,188 Retained earnings 6,562 Total common equity $23,438 $18.750 Total assets $31,250 $25,000 Total abilities and equity $31,250 $25,000 Given the information in the preceding balance sheet-and assuming that Cold Goose Metal Works 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. This statement is because: Cold Goose's total current liabilities balance increased from $1,688 million to $2,109 million between Year 1 and Year 2 Cold Goose's total current asset balance actually increased from $11,250 million to $14,062 million between Year 1 and Year 2 Cold Goose's total current liabilities balance decreased by $2,812 million between Year 1 and Year 2 Statement #2: In Year 2, Cold Goose Metal Works Inc. was profitable. This statement is because: The cash and equivalents account increased between Years 1 and 2 Cold Goose's total assets increased between Years 1 and 2 Cold Goose's retained earnings account increased between the end of Years 1 and 2 This statement is because: Debtholders are treated as residual investors Common shareholders are treated as residual investors Debtholders and preferred shareholders are considered residual investors Based on your understanding of the different items reported on the balance sheet and the information they provide, which statement regarding Cold Goose Metal Works Inc.'s balance sheet is consistent with U.S. Generally accepted Accounting Principles (GAAP)? The company's debts should be listed from those carrying the largest balance to those with the smallest balance The company's debts are listed in the order in which they are to be repaid The company's debts should be listed in order of their liquidity. The batance 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. Cold Goose Metal Works 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. Cold Goose Metal Works Inc. Balance Sheet for Year Ending December 31 (Millions of dollars) Year 2 Year 1 Year 2 Year 1 Assets Liabilities and equity Current assets: Current liabilities: Cash and equivalents $4,612 Accounts payable $0 $0 Accounts receivable 2,109 1,688 Accruals 293 0 Inventories 6,187 4,950 Notes payable 1,660 1,562 Total current assets $14,062 $11,250 Total current liabilities $1,562 Net fixed assets: Long-term debt 5,859 4,688 Net plant and equipment $13,50 Total debt $7,812 $6,250 Common equity Common stock 15,235 12,188 Retained earnings 6,562 Total common equity $23,438 $18.750 Total assets $31,250 $25,000 Total abilities and equity $31,250 $25,000 Given the information in the preceding balance sheet-and assuming that Cold Goose Metal Works 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. This statement is because: Cold Goose's total current liabilities balance increased from $1,688 million to $2,109 million between Year 1 and Year 2 Cold Goose's total current asset balance actually increased from $11,250 million to $14,062 million between Year 1 and Year 2 Cold Goose's total current liabilities balance decreased by $2,812 million between Year 1 and Year 2 Statement #2: In Year 2, Cold Goose Metal Works Inc. was profitable. This statement is because: The cash and equivalents account increased between Years 1 and 2 Cold Goose's total assets increased between Years 1 and 2 Cold Goose's retained earnings account increased between the end of Years 1 and 2 This statement is because: Debtholders are treated as residual investors Common shareholders are treated as residual investors Debtholders and preferred shareholders are considered residual investors Based on your understanding of the different items reported on the balance sheet and the information they provide, which statement regarding Cold Goose Metal Works Inc.'s balance sheet is consistent with U.S. Generally accepted Accounting Principles (GAAP)? The company's debts should be listed from those carrying the largest balance to those with the smallest balance The company's debts are listed in the order in which they are to be repaid The company's debts should be listed in order of their liquidity