The financial statements of Coca-Cola and PepsiCo are presented in Appendices C and D, respectively. The companies’ complete annual reports, including the notes to the financial statements, are available online.

Instructions

Use the companies’ financial information to answer the following questions.

a. What amount is reported in the balance sheets as property, plant, and equipment (net) of Coca-Cola at December 31, 2017, and of PepsiCo at December 31, 2017? What percentage of total assets is invested in property, plant, and equipment by each company?

b. What depreciation methods are used by Coca-Cola and PepsiCo for property, plant, and equipment? How much depreciation and amortization was reported by Coca-Cola and PepsiCo in 2017? In 2016? (Use cash flow statement amounts.)

c. Compute and compare the following ratios for Coca-Cola and PepsiCo for 2017.

1. Asset turnover.

2. Profit margin on sales.

3. Return on assets.

d. What amount was spent in 2017 for capital expenditures by Coca-Cola and PepsiCo?