Question
Financial Analysis Project Requirements: You will use the Financial Statements for coca cola, pepsi, and Keurig Dr. Pepper as provided on their websites to complete
Financial Analysis Project
Requirements:
You will use the Financial Statements for
coca cola, pepsi, and Keurig Dr. Pepper
as provided on their websites to
complete the following analysis:
1.
Calculate the current ratio and quick ratio for both companies for 2020 and 2021. Write
a paragraph describing what these ratios indicate about the liquidity of
coca cola, pepsi, and Keurig Dr. Pepper in 2020 compared to 2021.
a paragraph describing what these ratios indicate
about the liquidity of coke compared to pepsi and Keurig Dr. Pepper for both years. Which company seems to
be more liquid? What are the advantages and disadvantages of liquidity?
2.
Calculate the accounts receivable turnover and days sales in receivables for both
companies for 2020 and 2021. a paragraph comparing 2020 with 2021 and coca cola
with Pepsi,and Keurig Dr. Pepper using these three ratios to indicate the effectiveness of their accounts receivable collection. Which of the three seems to be doing a better job with receivables?
How does this collection process affect the overall success of the company.
3.
Calculate inventory turnover and days in inventory for both companies for 2020 and
2021. a paragraph comparing 2020 with 2021 and coca cola with Pepsi and Keurig Dr. Pepper using these three ratios to indicate how they manage their inventory. Which one of the three companies has a better approach to inventory management? Why? What are the problems that
come with poor inventory management?
4.
Calculate the gross margin, profit margin and return on investment for both companies
for 2020 and 2021. Explain in a paragraph what these ratios show about each
company's profitability compared to the year before and compared to each other.
Indicate which company shows the best prospects for future profits and explain in detail
why you think the ratios support your observation.
5.
Prep a vertical analysis or same size income statement and balance sheet for
coca cola with Pepsi,and Keurig Dr. Pepper for 2020 and 2021. Write a paragraph highlighting what you learn from
the percentages of sales or total assets calculated from the financial statements. Write
also about the comparison between 2020 and 2021 and between
coca cola with Pepsi,and Keurig Dr. Pepper
6.
Compare coca cola income statement for 2020 with their income statement for 2021 -
calculate the change in dollars and percent for all of the revenues and expenses. What
do the changes indicate about Pepsi,and Keurig Dr. Pepper success in 2020 relative to 2021? Do the same comparison for Pepsi,and Keurig Dr. Pepper income statement. What do the changes indicate about Pepsi,and Keurig Dr. Pepper improvement or lack thereof between 2020 and 2021? With this comparison of both companies over time now compare coca cola, Pepsi,and Keurig Dr. Pepper and explain why one company is better than the other.
7.
Based on all of your calculations and observations described above, make a
recommendation as to which company would be a better investment. Give the reasons
for your conclusion.
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