Analysis should include the following:

1. An eye-ball assessment of the changes in Cokes financial statements between 2006 and 2016e.g., overall growth in assets, revenues, equity, debt, etc.
2. Analysis of the Common-size statementsi.e., what changed and why. That is, describe the changes in these statements and analyze the cause of the changes. Include: a) mix of assets, b) split between current assets and fixed assets, c) mix of debt, d) split between current liabilities and LT liabilities, capital structure (i.e., debt and equity), e) profitability at all levels, f) changes in expenses, etc. This section must include evidence of research indicating what events had substantive effects on Cokes financial profile during the 10 year period. In other words, profitability may have increased due to introduction of new product lines, leverage may have increased due to the issuance of bonds, and assets may have increased due to acquisitions. These are offered as examples, and your research should indicate what occurred and how it affected Coke from a financial perspective.
3. Analysis of the ratios by categoryinclude in this an explanation of the cause of the changee.g., liquidity increased due to the increase in CAs and decrease in CLs. In addition to discussing each of the individual ratios, this section must include an overall conclusion regarding the direction of the four major categories of ratios. In other words, you must draw conclusions regarding the overall trends in 1) liquidity, 2) efficiency, profitability, and 4) leverage over the 10 year period. You must also provide industry averages where available so that you can compare Cokes ratios to those of its industry competitors.
4. Analysis of the DuPont equation and discussion of the underlying reasons for the changes in ROI (ROA) and ROE.
5. Analysis of working capital and discussion of the implication of a positive or negative WC level. Is Cokes WC policy conservative, moderate, aggressive? Why?
6. Analysis of the Cash Conversion Cycle and discussion of its implications.
7. Summary and conclusion concerning the major changes in Cokes financial situation.

Coca-Cola Common-Size Statements of Income and Retained Earnings for December 2006 and 2016 All Amounts in Millions 2006 24,088 % 100% 2016 $ 41,863 100% Revenue Cost and Expenses Cost of Sales $8,164 $15,924 34% 66% $16,465 $ 25,398 39% 61% Gross Profit S, G, and A $9,616 Interest Charges Other Income/Expenses (net) Total Cost and Expenses Income before Income Taxes $220 ($490) $17,510 $6,578 40% 1% -2% 73% 27% $16,772 $ 733 ($243) $ 33,727 $ 8,136 40% 2% - 5% 81% 19.4% $1,498 6% 4% $ 1,586 ($23) $6,527 -0.4% 21% Provision of Income Taxes Other Income Net Income Dividends (% of NI) Adjustments to Retained Earnings Retained Earnings, Beginning Balance Retained Earnings, Ending Balance 15.6% 83.6% 5,080 57% $0 $28,388 $33,468 $ 65,018 $ 65,502 Coca-Cola Common Size Balance Sheets for December 2006 and 2016 All amounts in Millions 2006 % 2016 % Assets Current Assets Cash and Equivalents Receivables Inventory $2,440 $2,704 $1,641 $1,656 $8,441 8% 9% 5.5% $22,201 $3,856 $2,675 $5,278 $34,010 25.4% 4.4% 3.1% 6.1% 39.0% Other 5.5% 28% Total Current Assets Productive Assets Property, Plant, and Equipment (net) $6,903 $10,635 23% 49% 71.8% 100% $10,635 $42,625 $53,260 $87,270 12.2% 48.8% 61.0% 100% 19% 11% $2,682 $16,025 $7,825 $26,532 3.1% 18.4% 9.0% 30.5% 30% Net Productive Assets $6,903 Other Assets $14,619 Total non-current assets $21,522 Total Assets $29,963 Liabilities And Shareholders' Equity Liabilities Current Liabilities Accounts Payable $5,622 Current Debt Due $3,268 Other $0 Total Current Liabilities $8,890 Long-Term Liabilities LT Debt $1,314 Other LT Liabilities $2,231 Deferred Income Taxes $ 608 Total LT Liabilities $4,153 Total Liabilities $13,043 Shareholders' Equity Common Stock $878 Treasury Stock ($22,118) Retained Earnings $33,468 Equity Adjustments ($1,291) Capital Surplus $ 5,983 Total Shareholders' Equity $16,920 Total Equity + Liabilities $29,963 4% 7% 2% 13% 43% $29,684 $3,753 $4,239 $37,676 $64,208 34.0% 4.3% 4.9% 43.2% 73.6% 3% -74% 112% -5% 20% 57% 100% $1,760 ($47,988) $65,502 ($11,205) $14,993 $23,062 $87,270 2.0% -55.0% 75.1% -12.8% 17.2% 26.5% 100% Ratio Analysis for Coco-Cola: 2006 and 2016 2006 2016 Definition Ratio Liquidity 1. Current ratio 1.28 2. Quick ratio (acid test) current assets current liabilities current assets - inventories current liabilities 1.18 Asset Management 3. Average collection period Total Rev. = Cr. Sales 33.6 accounts receivables credits sales/365 cost of sales average inventory 4. Inventory turnover INO = AVE INV 5.64 3.94 0.48 0.735 2.78 sales 5. Fixed asset turnover fixed assets FIXED ASSETS = NET 6. Total asset turnover sales total assets Financial Leverage Management 7. Debt Ratio total debt ST+LT= Total Debt total assets 8, Debt-to-equity total debt ST+LT total equity Profitability 9. Gross profit margin sales - cost of sales sales 10. Net profit margin earnings after taxes (EAT) sales 11. Return on investment earnings after taxes (EAT) total assets 12. Return on Stockholders' equity earnings after taxes (EAT) stockholders' equity 66.1 60.7 21.1 17.0 7.5 30.0 28.3 Dividend Payout 57% 83.6% Du Pont Model ROI or ROA: ROI = Profit Margin x Asset Turnover - = Net Profit Net Sales Net Sales Total Assets ROI =- (2006) 21.1% X ,80 = 17% $5,080 $24,088 $6,527 $24,088 $29.963 - = $41,863 = $87,270 ROI (2016) 15.6% x 0.48 = 7.5% $41,863 ROE: ROE = Profit Margin x Asset Turnover X Leverage Where Leverage = Total Assets/Equity ROE (2006) = 21.1% ROE (2016) = 15.6% X.8 X X 0.48 x 1.77 = 29.9% 3.78 = 28.3% Working Capital Working Capital = Current Assets - Current Liabilities 2006 Working Capital: 8441 - 8890 = 449 2016 Working Capital: 34,010 - 26,532 = +7478 Cash Conversion Cycle 2006 2016 Accounts Receivable Days: 33.6 Inventory Days: 59.4 Accounts Payable Days: 59.5 CCC 33.6 Coca-Cola Common-Size Statements of Income and Retained Earnings for December 2006 and 2016 All Amounts in Millions 2006 24,088 % 100% 2016 $ 41,863 100% Revenue Cost and Expenses Cost of Sales $8,164 $15,924 34% 66% $16,465 $ 25,398 39% 61% Gross Profit S, G, and A $9,616 Interest Charges Other Income/Expenses (net) Total Cost and Expenses Income before Income Taxes $220 ($490) $17,510 $6,578 40% 1% -2% 73% 27% $16,772 $ 733 ($243) $ 33,727 $ 8,136 40% 2% - 5% 81% 19.4% $1,498 6% 4% $ 1,586 ($23) $6,527 -0.4% 21% Provision of Income Taxes Other Income Net Income Dividends (% of NI) Adjustments to Retained Earnings Retained Earnings, Beginning Balance Retained Earnings, Ending Balance 15.6% 83.6% 5,080 57% $0 $28,388 $33,468 $ 65,018 $ 65,502 Coca-Cola Common Size Balance Sheets for December 2006 and 2016 All amounts in Millions 2006 % 2016 % Assets Current Assets Cash and Equivalents Receivables Inventory $2,440 $2,704 $1,641 $1,656 $8,441 8% 9% 5.5% $22,201 $3,856 $2,675 $5,278 $34,010 25.4% 4.4% 3.1% 6.1% 39.0% Other 5.5% 28% Total Current Assets Productive Assets Property, Plant, and Equipment (net) $6,903 $10,635 23% 49% 71.8% 100% $10,635 $42,625 $53,260 $87,270 12.2% 48.8% 61.0% 100% 19% 11% $2,682 $16,025 $7,825 $26,532 3.1% 18.4% 9.0% 30.5% 30% Net Productive Assets $6,903 Other Assets $14,619 Total non-current assets $21,522 Total Assets $29,963 Liabilities And Shareholders' Equity Liabilities Current Liabilities Accounts Payable $5,622 Current Debt Due $3,268 Other $0 Total Current Liabilities $8,890 Long-Term Liabilities LT Debt $1,314 Other LT Liabilities $2,231 Deferred Income Taxes $ 608 Total LT Liabilities $4,153 Total Liabilities $13,043 Shareholders' Equity Common Stock $878 Treasury Stock ($22,118) Retained Earnings $33,468 Equity Adjustments ($1,291) Capital Surplus $ 5,983 Total Shareholders' Equity $16,920 Total Equity + Liabilities $29,963 4% 7% 2% 13% 43% $29,684 $3,753 $4,239 $37,676 $64,208 34.0% 4.3% 4.9% 43.2% 73.6% 3% -74% 112% -5% 20% 57% 100% $1,760 ($47,988) $65,502 ($11,205) $14,993 $23,062 $87,270 2.0% -55.0% 75.1% -12.8% 17.2% 26.5% 100% Ratio Analysis for Coco-Cola: 2006 and 2016 2006 2016 Definition Ratio Liquidity 1. Current ratio 1.28 2. Quick ratio (acid test) current assets current liabilities current assets - inventories current liabilities 1.18 Asset Management 3. Average collection period Total Rev. = Cr. Sales 33.6 accounts receivables credits sales/365 cost of sales average inventory 4. Inventory turnover INO = AVE INV 5.64 3.94 0.48 0.735 2.78 sales 5. Fixed asset turnover fixed assets FIXED ASSETS = NET 6. Total asset turnover sales total assets Financial Leverage Management 7. Debt Ratio total debt ST+LT= Total Debt total assets 8, Debt-to-equity total debt ST+LT total equity Profitability 9. Gross profit margin sales - cost of sales sales 10. Net profit margin earnings after taxes (EAT) sales 11. Return on investment earnings after taxes (EAT) total assets 12. Return on Stockholders' equity earnings after taxes (EAT) stockholders' equity 66.1 60.7 21.1 17.0 7.5 30.0 28.3 Dividend Payout 57% 83.6% Du Pont Model ROI or ROA: ROI = Profit Margin x Asset Turnover - = Net Profit Net Sales Net Sales Total Assets ROI =- (2006) 21.1% X ,80 = 17% $5,080 $24,088 $6,527 $24,088 $29.963 - = $41,863 = $87,270 ROI (2016) 15.6% x 0.48 = 7.5% $41,863 ROE: ROE = Profit Margin x Asset Turnover X Leverage Where Leverage = Total Assets/Equity ROE (2006) = 21.1% ROE (2016) = 15.6% X.8 X X 0.48 x 1.77 = 29.9% 3.78 = 28.3% Working Capital Working Capital = Current Assets - Current Liabilities 2006 Working Capital: 8441 - 8890 = 449 2016 Working Capital: 34,010 - 26,532 = +7478 Cash Conversion Cycle 2006 2016 Accounts Receivable Days: 33.6 Inventory Days: 59.4 Accounts Payable Days: 59.5 CCC 33.6