ment CALCULATOR PRINTER VERSION BACK The Coca-Cola Company and PepsiCo, Inc. pro
ID: 2548690 • Letter: M
Question
ment CALCULATOR PRINTER VERSION BACK The Coca-Cola Company and PepsiCo, Inc. provide refreshments to every comer of the world. Suppose selected data from recent consolidated financial PepsiCo, Inc. are presented here (in millions) statements for The Coca-Cola Company and for Coca-PepsiCo Cola $17,551 $12,571 13,721 8,756 30,99043,232 11,08820,099 6,824 5,946 Total current assets Total current liabilities Net sales Cost of goods sold Net income Average (net) accounts receivable for the year Average inventories for the year Average total assets Average common stockholders equity 3,424 4,654 2,2712,570 44,59537,921 22,63614,556 13,3558,772 21,96023,466 48,671 39,848 23,87223,044 2,0402,100 397 8,1866,796 1,9932,128 3,800,732 Average current liabilities Average total liabilities Total assets Total liabilities Income taxes interest expense Net cash provided by operating activit Capital expenditures Cash dividends 355 Y(a1) Compute the folowing liquidity ratios tor Coca-Cola and for PepsiCo. (Round current rotio and current cash debt coverage ratio to 2 decimal places, e.g. 6.25 and all other answers to I decimal ere to search 3-55 PMExplanation / Answer
Current ratio
Cocal cola
The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations. To gauge this ability, the current ratio considers the current total assets of a company (both liquid and illiquid) relative to that company’s current total liabilities. The formula for calculating a company’s current ratio is
Current ratio = Current asset/ Current liability
= 17551/ 13721
= 1.28
Current ratio is 1.28
PepsiCo
Current ratio = Current asset/ Current liability
= 12571/ 8756
= 1.44
Current ratio is 1.44
--------------------------------------------------------------------------------------------------------------------------
Cocal cola
A/R turnover ratio = sale/ average receivable
= 30990/3424 = 9.05
PepsiCo
A/R turnover ratio = 43232/4654 = 9.29
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.