Coke and Pepsi are well-known international brands. Coca-Cola sells more than $35 billion worth of beverages each year while annual sales of Pepsi products exceed $43 billion. Compare the two companies as a potential investment based on the following ratios: Ratio Gross profit percentage Net profit margin Return on equity EPS Receivables turnover ratio Inventory turnover ratio Current ratio Debt-to-assets P/E ratio Coca- Cola 63.9% 33.6% 37.7% $5.06 8.6 5.1 1.17 0.57 12.6 PepsiCo 54.1% 10.9% 29.4% $ 3.91 10.6 8.9 1.11 0.68 16.2 Required: 1-a. Which company appears more profitable? Coca-Cola PepsiCo 1-b. Describe the ratio(s) that you used to reach this decision. (Select all that apply.) Gross profit percentage Net profit margin Return on equity Earnings per share Asset turnover Fixed asset turnover 2-a. Which company appears more liquid? Coca-Cola O PepsiCo 2-b. Describe the ratio(s) that you used to reach this decision. (Select all that apply.) Receivable turnover Price/earnings ratio Inventory turnover ratio Accounts receivable turnover ratio Current ratio Quick ratio 3-a. Which company appears more solvent? O Coca Cola PepsiCo 3-b. Describe the ratio(s) that you used to reach this decision. (Select all that apply.) Debt-to-assets ratio Price/earnings ratio Current ratio Inventory turnover ratio Receivables turnover ratio