The financial statements of PepsiCo are presented in Appendix A at the end of this textbook.

Instructions 

Answer the following questions using the Consolidated Statement of Income.

(a) What was the percentage change in (1) sales and in (2) net income from 2003 to 2004 and from 2004 to 2005?

(b) What was the company’s gross profit rate in 2003, 2004, and 2005?

(c) What was the company’s percentage of net income to net sales in 2003, 2004, and 2005?
Comment on any trend in this percentage.

Data from Appendix A

Transcribed Image Text:

Consolidated Statement of Income PepsiCo, Inc. and Subsidiaries Fiscal years ended December 31, 2005, December 25, 2004 and December 27, 2003 PEPSICO 2003 Het Revenue......... Cost of sales. Selling, general and administrative expenses. $32,562 $29,261 $26,971 14,176 12,674 11,691 12.314 11,031 10,148 Amortization of intangible assets. 150 147 145 Restructuring and impairment charges.. 150 147 Merger-related costs... 59 Operating Profit. 5.922 5,259 4,781 Bottling equity income.. 557 380 323 Interest expense... (256) (167) (163) Interest income... 159 74 51 Income from Continuing Operations before Income Taxes. 6.382 5,546 4,992 Provision for Income Taxes......... 2,304 1,372 1,424 Income from Continuing Operations... 4,078 4,174 3,568 Tax Benefit from Discontinued Operations. 38 Net Income Net Income per Common Share Continuing operations.. Discontinued operations.. Total $4,078 $ 4,212 $ 3,568 Basic $2.43 $2.45 $2.07 0.02 $2.43 $2.47 $2.07