The balance 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. 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. reen Caterpillar Garden Supplies Inc. Balance Sheet for Year Ending December 31 (Millions of Dollars) Year 2 Year 1 Year 2 Year 1Assets Liabilities and equity Current assets: Current liabilities: Cash and equivalents $6,457 Accounts payable $0 $0Accounts receivable 2,953 2,363 Accruals 410 0Inventories 8,662 6,930 Notes payable 2,324 2,187Total current assets $19,687 $15,750 Total current liabilities $2,187Net fixed assets: Long-term debt 8,203 6,563Net plant and equipment $19,250 Total debt $10,937 $8,750 Common equity: Common stock 21,328 17,063 Retained earnings 9,187 Total common equity $32,813 $26,250Total assets $43,750 $35,000 Total liabilities and equity $43,750 $35,000 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 (True or False) , because:Green Caterpillar’s total current asset balance actually increased from $15,750 million to $19,687 million between Year 1 and Year 2Green Caterpillar’s total current liabilities balance decreased by $3,937 million between Year 1 and Year 2Green Caterpillar’s total current liabilities balance increased from $2,363 million to $2,953 million between Year 1 and Year 2Statement #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 , because:Green Caterpillar’s Year 2 cash and equivalents balance is $20,317The funds recorded in Green Caterpillar’s accounts receivable account represents funds that are either cash or can be converted into cash almost immediatelyThe funds recorded in Green Caterpillar’s cash and equivalents account represents funds that are either cash or can be converted into cash almost immediatelyStatement #3: If Green Caterpillar ever goes bankrupt, its common stockholders will be paid off first, then its debtholders and preferred stockholders. This statement is (correct or incorrect) , because:Common shareholders are treated as residual investorsDebtholders are treated as residual investorsDebtholders and preferred shareholders are considered residual investorsBased 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 (Remain the same, increase or decrease if the firm issues $3 million of new common stock.