FINAL PROJECT 1 Final Project Assignment Shawn Ovington XACC/280 Sheila Sullivan FINAL PROJECT 2 Keeping good records is a key in any good business and it helps companies find key areas where they feel they can improve. Coke and Pepsi are two large named soda distributers that have been along for many years and are constantly being compared. Before obtaining both companies financial statements, I was kind of clueless in who was more financially set but knew both were respectable companies. In this essay, I am going to …show more content…
Next I am going to do the same calculations for the Coke company by using their same information to find out their change in assets and liabilities between the two years. For the assets you would take ($29,427 – $31,441) ÷ $31,441 = –6.4% this means there total assets dropped 6.4% in the two years. FINAL PROJECT 4 The same calculations would have to be done to find out the change in liabilities for coke in the two years and to do that you would have to take ($13,072 - $15,506) ÷ $15,506 = –16%, meaning they lowered their liabilities between the two years. The last of the three analyses in the financial statement is the Ratio analysis. There are three different ratios with different calculations in each they are liquidity, Solvency, and profitability. In the text book it states that the “Ratio analysis expresses the relationship among selected items of financial statement data” (Weygandt and Kimmel 2008 p.699). The first ratio I am going to find is the current ratio for each company in 2004 and 2005 which is a liquidity. To do this ratio I will have to take the current assets and divide by the current liabilities. In 2004 the current ratio for Pepsi was 1.28:1 I found this by taking 8,639 ÷ 6,752 = 1.28:1. Using the exact same method I take the number for 2005 doing the same calculations and the current ratio turns out being1.11:1 by taking $10,454 ÷ $9,406 = 1.11:1. The same
To analysis financial statements there are various tools. Ratio analysis is one of them. In ratio analysis we establish relationship between two or more items of financial statements and derive some vital information about the business.
Q6. XYZ Ltd is a publicly listed company which has suffered from major sales declines, due to increased foreign completion, and has made a succession of losses over the past three years. During the year, its CEO resigned and was replaced by Chief Operating Officer (COO). The trial balance reveals that sales were $10,000,000 and the company made a loss of $500,000. At what level
9. Clemente Co. owned all of the voting common stock of Snider Co. On January 2, 2009, Clemente sold some equipment to Snider for $125,000. The equipment had cost $140,000. At the time of the sale, the balance in accumulated depreciation was $40,000. The equipment had a remaining useful life of five years and a $0 salvage value. Straight-line depreciation is used by both Clemente and Snider. At what amount should the equipment (net of depreciation) be included on the consolidated balance sheet dated December 31, 2009?
Uncollectible accounts expense is estimated by the aging-of-accounts-receivable method. Management estimates that $35,000 of accounts receivable will be uncollectible. Which of the following will be the amount of Uncollectible accounts expense? 35000 -4500 = 30,500
The analysis of a company's financial statements helps in the determination of both the weaknesses and strengths of the concerned entity. Further, such an analysis helps in the determination of the future viability of firms. There are a wide range of techniques utilized in the analysis of financial statements. In that regard, it is important to note that the relevance of a horizontal, vertical as well as ratio analysis of a company's financial statements cannot be overstated. This is more so the case when it comes to the interpretation of the various dollar amounts presented in both the balance sheet and the income statement. In this text, I carry out a horizontal, vertical as well as ratio analysis of both The Coca-Cola Company and PepsiCo, Inc. The analysis' results will be critical in the evaluation of each company's performance. Findings will be used as a basis for recommendations on how each company can improve its financial status.
10. Fixed asset turnover = Total Revenues in Statement of Operations / Net Property and
An eyeball assessment of the changes in Coke’s financial statements between 1996 and 2010 show that mainly all accounts are up. The total assets are up from 1996 to 2010 with an increase from $16,161 to $72,921. Also current assets increased 3.6% from 1996 to 2010 with total non-current assets increasing 5%. Revenue nearly doubled from 1996 having only $18,546 to increasing in 2010 to $35,119. The total current liabilities increased over the years from $7,406 to $18,508. The total long term liabilities also show an increase from 1996 having $2,599 to $23,410 in 2010. Also the
Ratio analysis: Perform trend and ratio analysis on current and fixed assets, current and long term liabilities, owner’s equity, sales revenues, EBIT, net income, and earnings per share. Project these trends
To calculate the current ratio, which is one of the most popular liquidity ratios you divide all of firms current assets by all of its current liabilities. McDonalds has $1,819.3 (*everything is in millions for McDonalds) of current assets and $2,248.3 in current liabilities making the firms current ratio .81. In 2005 Wendys has current assets of $266,353 and current liabilities of $296,687 making their current ratio .90. Current ratios are used to represent good liquidity and financial health. Since current ratios vary from industry to industry, the industry average determines if a firms current ratio is up to par, strength or a weakness. In any event if the current ratio is less than the industry average than an analyst or individual interested in investing might wonder why the firm isn't
Coca-Cola is a leading beverage industry in the United States and many other countries in the world. PepsiCo is also a leading worldwide beverage company, but they are also the parent company of the Frito-Lay and Quaker Oats Companies. This makes PepsiCo a leader in the beverage, snack and cereal industries. As consumers, we have indulged in their products for many years. My personal preference has always been Pepsi over Coke, which is why I was very interested in conducting this analysis. Regardless of the results, I will always seek out a Diet Pepsi over a Diet Coke and so will many of my physician friends at Children’s Hospital who start their mornings with a Diet Pepsi. These personal preferences are what contributes to a company’s profits through net sales. However, the key performance measurement tools used are not based on sales alone. Calculating liquidity, solvency, and profitability ratios on a regular basis give us a better insight on the performance and overall health of a company.
The company currently faces serious financial challenges. It was struggling with declining sales and increasing costs. Since 2004, revenues had fallen by more than 40% while costs especially for employees health insurance, maintenance, and utilities climbed. Credits and loans had been borrowed to
All managers need to understand where value comes from in their firm. The purpose of this analysis is to identify the financial strategy and performance of this particular publicly traded company. The process of understanding the risk and profitability of a company by analyzing reported financial info, especially annual and quarterly reports are vital to identifying the company’s overall financial performance. I wanted to analyze Coca Cola because the company has so much history and is one of the most recognizable brands in the world. I have always enjoyed researching food and beverage companies
The calculation of ratios is the calculation technique for analyzing a company’s financial performance that divides or standardize one accounting measure by another economically relevant measure. Financial ratios can be used as a tool to demonstrate financial statement users for making valid comparisons of firm operating performance, over time for the same firm and between comparable companies. External investors are mostly interested in gaining insights about a firm’s profitability, asset management, liquidity, and solvency.
Ratio analysis is generally used by the company to provide some information on how the company has performed during that year, so that the parties involved including shareholders, lenders, investors, government and other users could make some analysis before making any further decision towards that particular company. As mentioned by Gibson (1982a cited in British Accounting Review, 2002 pg. 290) where he believes that the use of ratio analysis is such an effective tool to evaluate the company’s finance, and to predict its future financial state. Ratios are simply divided in several categories; these are the profitability, liquidity, efficiency and gearing.
EXECUTIVE SUMMARY In investigating PepsiCo’s accounting policies for G. D. Meyers and Company, we have focused on nine major areas of the annual report, comparing PepsiCo with Coca Cola throughout our analysis. Through the Balance Sheet, we focused on the major assets and major liabilities of each, and discovered that the primary difference is PepsiCo’s large balance of intangibles. In the Income Statement, we analyzed the major sources of revenue and expenses for