Essay on Coca-Cola Financial Analysis

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Introduction The Coca-Cola recipe was originally founded and formulated by John Pemberton at the Pemberton’s Eagle Drug and Chemical House. By 1885, the product was registered as a French Wine Coca as a patent medicine. Pemberton claimed Coca-Cola cured morphine addiction, dyspepsia, neurasthenia, headaches and impotence. The carbonated drink began its first sales at Jacob’s Pharmacy in Atlanta, Georgia on May 8, 1886 for 5 cents a glass with its first advertisement in the Atlanta Journal on May 29, 1886. It wasn’t until 1955 when cans of Coke started to make its first appearance (Official Coca-Cola website). By the 21st century, Coca-Cola is proclaimed to be the world’s largest beverage company sold in more than 200 countries.…show more content…
(In millions) 2011 2012 Cash $12,803 $8,442 Short term investments 1,088 5,017 Marketable securities 4,920 4,759 Trade accts. receivables 3,092 3,264 Inventories 3,450 2,781 Prepaid expenses and other assets 144 3,092 Assets held for sale 0 2,973 TOTAL CURRENT ASSETS $25,497 $30,328 TOTAL CURRENT ASSETS $25,497 $30,328 LESS CURRENT LIABILITIES $24,283 $27,821 WORKING CAPITAL $1,214 $2,507 CURRENT RATIO 1.0 1.1 ($25,497/$24,283) Coca-Cola’s Quick Ratio for FY2011 and FY2012 were calculated by also utilizing the company’s consolidated balance sheets. The ‘quick assets’ for the company were added together to get a total which included the cash assets, temporary investments, and accounts receivable. The quick assets were divided into the current liabilities to get the ‘quick’ ratio’s indicated above. Coca-Cola’s quick ratio deteriorated from 2011 to 2012. Quick ratio shows the extent of cash and other current assets that are readily convertible into cash in comparison to the short term obligations of an organization. A quick of 0.5+ would suggest that a company is able to settle half of its current liabilities instantaneously. However, it is better for a company to have at least a 1.0+

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