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Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281

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BuyFindarrow_forward

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281
Textbook Problem
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You are preparing to visit a friend who now lives in Atlanta. Your friend is very interested in The Coca-Cola Company. Your friend is not a business major and has asked for your help to learn more about Coca-Cola. Obtain The Coca-Cola Company’s 2017 annual report either using the “Investor Relations” portion of its web site (do a Web search for Coca-Cola investor relations) or go to http://www.sec.gov and click “Search for company filings” under “Filings and Forms (EDGAR).”

Required:

Read carefully through Coca-Cola’s financial statements. Prepare a brief written report for your friend that (in your opinion) provides two interesting and important pieces of information about Coca-Cola from the:

  • Balance Sheet
  • Income Statement
  • Statement of Cash Flows

To determine

Write a brief report for your friend that provides two interesting and important pieces of information about Company CC from the major financial statements and management discussion and analysis report.

Explanation

Company CC is one of the popular beverage companies across the globe. Based on the financial statements of the Company CC, following information can be extracted from the financial statements as follows:

Balance sheet:

  • At the end of the fiscal year, the total current assets have increased from $34,010 million (2016) to $36,545 million (2017). The increase in current assets is due to the increase in marketable securities.
  • The total assets have also increased from $87,270 million (2016) to $87,896 million (2017).
  • There has been an increase in long term debts from $29,684 (2016) to $31,182 million (2017) and the current liabilities (loans and notes payable) have also increased from $12,498 (2016) to $13,205 million (2017).
  • Moreover, the total equity has decreased from $23,220 (2016) to $18,977 million (2017).

Income statement (Consolidated statement of income):

  • The net operating revenues have decreased substantially over the years from $44,294 million in 2015 to $41,863 million in 2016 to $35,410 million in 2017.
  • The cost of goods sold has also decreased over the years.
  • The equity income has increased significantly from $489 million in 2015 to $835 million in 2016 and to $1,071 million in 2017...

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