Introduction: A Balance sheet is a financial statement, which presents the correct position of the assets, liabilities and share holders’ equity at a given point of time.
(a)
To show: To show what descriptions are used by G&P in its balance sheet to classify its property, plant, and equipment.
(b)
(b)
To determine what method or methods of
(c)
(c)
To determine over what estimated useful lives does G&P depreciate its property, plant, and equipment.
(d)
(d)
To determine what amounts for depreciation and amortization expense did G&P charge to its income statement in 2014, 2013, and 2012.
(e)
(e)
To determine what were the capital expenditures for property, plant, and equipment made by G&P in 2014, 2013, and 2012.
The Coca-Cola Company and PepsiCo.Inc.
(a)
To determine what amount is reported in the balance sheets as property, plant, and equipment (net) of Coca-Cola Company (CC) on December 31, 2014, and of Pepsi Co.Inc. (PC) on December 31, 2014? What percentage of total assets is invested in property, plant, and equipment by each company.
(b)
(b)
To determine what depreciation methods are used by CC and PC for property, plant, and equipment? How much depreciation and amortization was reported by CC and PC in 2014 and in 2013. (Use
(c)
(c)
To compute and compare: To compute and compare the following ratios for CC and PC for 2014:
(1) Asset turnover.
(2) Profit margin on sales.
(3) Return on assets.
(d)
(d)
To determine what amount was spent in 2014 for capital expenditures by CC and PC.
McDonald’s Corporation
(a)
To determine what method of depreciation does McDonald’s Corporation (McD) use.
(b)
(b)
To explain: To explain whether depreciation and amortization expense cause cash flow from operations to increase.
(c)
(c)
To explain: To explain what does the schedule of cash flow measures indicate.
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