Current Position Analysis: PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years: Current Year (in millions)Prior Year (in millions)Cash and cash equivalents$5,943$3,943Short-term investments, at cost426192Accounts and notes receivable, net6,3234624Inventories3,3722,618Prepaid expenses and other current assets1,5051,194Short-term obligations4,8988,292Accounts payable10,994464a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.b. What conclusions can draw from these data?

Name: Current Position Analysis: PepsiCo, Inc., the parent company of Frito-
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Description: Current Position Analysis: PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years: Current Year (in millions)Prior Year (in millions)Cas

Current ratio = Current assets / Current liabilities Quick Ratio = Quick Assets / Current…

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EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 19P

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Current Position Analysis: PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years:

	Current Year (in millions)	Prior Year (in millions)
Cash and cash equivalents	$5,943	$3,943
Short-term investments, at cost	426	192
Accounts and notes receivable, net	6,323	4624
Inventories	3,372	2,618
Prepaid expenses and other current assets	1,505	1,194
Short-term obligations	4,898	8,292
Accounts payable	10,994	464

a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.

b. What conclusions can draw from these data?

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