Financial Analysis of PepsiCo and Coca Cola

1259 Words Jan 5th, 2014 6 Pages
Financial Analysis of PepsiCo and Coca Cola
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XACC 280 University of Phoenix

Financial Analysis2
Financial Analysis of PepsiCo and Coca Cola
PepsiCo and Coca Cola are two major companies that manufacture beverages. They compete to be the number on manufacturer and distributor of beverages in the world. These two companies are very identifiable in this market and you know them as PepsiCo and Coca Cola. These two companies have undoubtedly dominated the markets worldwide that they both receive universal recognition for their different products. Although, there are many other manufacturers and distributors of beverages these two are the major competitors. Not only do they produce soda drinks, they also
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The next thing we are going to look at is net income. Pepsi had in 2004 a net income of $4,212 and this yielded a ratio percentage of 15.1% of total assets and in 2005 their net income was $4,078 yielding a ratio percentage of 13.2% of their total assets. This is a 1.9% decrease in their net income between 2004 and 2005 and they also show a decrease in the cost of sales during the same period. Coke on the other hand had a net income of $4,847 in 2004 yielding a ratio percentage of 15.4% and in2005 their net income was $4,872 yielding a ratio of 16.6% of their total assets. This shows and an increase of 1.2% between 2004 and 2005. Although they experienced an increase it is not entirely an offset of their income overall, making this a negative indication for Coca Cola.
Now the breakdown of each company’s consolidated balance sheets to compare current assets and current liabilities to their total assets for each year considered. Pepsi’s total current assets in 2004 were $8,639 which yields a ratio percentage of 30.9% of total assets for that year. Pepsi’s total current assets in 2005 were $10,454 which yields a ratio percentage of 32.9% of total assets. This shows a 2%increase in current assets. In contrast coca Cola current asset in 2004 were $12,281 yielding a ratio percentage of 39.1% and in 2005 current asset were $10,250 yielding a ratio percentage of 34.8%;which show a major decrease in their current assets. Although, there was a significant decrease in their
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