PepsiCo’s financial statements are presented in Appendix B. Financial statements of The Coca-Cola Company are presented in Appendix C. Instructions for accessing and using the complete annual reports of PepsiCo and Coca-Cola, including the notes to the financial statements, are also provided in Appendices B and C, respectively.
Instructions
(a) Compute earnings per share and return on common stockholders’ equity for both companies for 2011. Assume PepsiCo’s weighted-average shares were 1.580 million and Coca-Cola’s weighted-average shares were 2,284 million. Can these measures be used to compare the profitability of the two companies? Why or why not?
(b) What was the total amount of dividends paid by each company in 2011?