Required 1. Compute the following liquidity and solvency ratios for Coca-Cola. a. Current ratio b. Quick ratio c. Debt-to-equity ratio d. Times interest earned \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{THECOCA-COLACOMPANYANDSUBSIDConsolidatedBalanceSheets(smillions)} \\ \hline December 31 & 2020 & 2019 \\ \hline \multicolumn{3}{|l|}{ Assets } \\ \hline \multicolumn{3}{|l|}{ Current assets } \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1.755 & 1.454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline \multicolumn{3}{|l|}{ Liabilities and equity } \\ \hline \multicolumn{3}{|l|}{ Current liabilities } \\ \hline Accounts payable and accrued expenses & 11,045 & 11,210 \\ \hline Loans and notes payable & 2,163 & 10,895 \\ \hline Current maturities of long-term debt & 481 & 4,215 \\ \hline Accrued income taxes & 781 & 410 \\ \hline Total current liabilities & 14,470 & 26,730 \\ \hline Long-term debt & 39,764 & 27,268 \\ \hline Other liabilities & 9,368 & 8,433 \\ \hline Deferred income tax liabilities & 1,817 & 2,263 \\ \hline \end{tabular} \begin{tabular}{|l|r|r|} \hline Operating income & 8,917 & 9,996 \\ \hline Interest income & 367 & 558 \\ \hline Interest expense & 1,424 & 937 \\ \hline Equity income (loss)-net & 969 & 1,040 \\ \hline Other income (loss)-net & 833 & 34 \\ \hline Income before taxes & 9,662 & 10,691 \\ \hline Income taxes & 1,963 & 1,785 \\ \hline Consolidated net income & $7,699 & $8,906 \\ \hline \end{tabular} \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{THECOCA-COLACOMPANYANDSUBSIDConsolidatedBalanceSheets($millions)} \\ \hline December 31 & 2020 & 2019 \\ \hline \multicolumn{3}{|l|}{ Assets } \\ \hline \multicolumn{3}{|l|}{ Current assets } \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1,755 & 1,454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline \end{tabular} 2. Interpret your results for Coca Cola in comparison to those of PepsiCo (which follow). Following are summarized 2020 and 2019 income statements and balance sheets for The Coca-Cola Company. \begin{tabular}{|c|c|c|} \hline cumen & & \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1.755 & 1,454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline Liabilities and equity & & \\ \hline Current liabilities & & \\ \hline Accounts payable and accrued expenses & $11,045 & $11,210 \\ \hline Loans and notes payable & 2,163 & 10,895 \\ \hline Current maturities of long-term debt & 481 & 4,215 \\ \hline Accrued income taxes & 781 & 410 \\ \hline Total current liabilities & 14,470 & 26,730 \\ \hline Long-term debt & 39,764 & 27,268 \\ \hline Other liabilities & 9,368 & 8,433 \\ \hline Deferred income tax liabilities & 1,817 & 2,263 \\ \hline Total liabilities & 65,419 & 64,694 \\ \hline Total equity & 21,092 & 20,908 \\ \hline Total liabilities and equity & $86,511 & $85,602 \\ \hline \end{tabular} Required 1. Compute the following liquidity and solvency ratios for Coca-Cola. a. Current ratio b. Quick ratio c. Debt-to-equity ratio d. Times interest earned \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{THECOCA-COLACOMPANYANDSUBSIDConsolidatedBalanceSheets(smillions)} \\ \hline December 31 & 2020 & 2019 \\ \hline \multicolumn{3}{|l|}{ Assets } \\ \hline \multicolumn{3}{|l|}{ Current assets } \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1.755 & 1.454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline \multicolumn{3}{|l|}{ Liabilities and equity } \\ \hline \multicolumn{3}{|l|}{ Current liabilities } \\ \hline Accounts payable and accrued expenses & 11,045 & 11,210 \\ \hline Loans and notes payable & 2,163 & 10,895 \\ \hline Current maturities of long-term debt & 481 & 4,215 \\ \hline Accrued income taxes & 781 & 410 \\ \hline Total current liabilities & 14,470 & 26,730 \\ \hline Long-term debt & 39,764 & 27,268 \\ \hline Other liabilities & 9,368 & 8,433 \\ \hline Deferred income tax liabilities & 1,817 & 2,263 \\ \hline \end{tabular} \begin{tabular}{|l|r|r|} \hline Operating income & 8,917 & 9,996 \\ \hline Interest income & 367 & 558 \\ \hline Interest expense & 1,424 & 937 \\ \hline Equity income (loss)-net & 969 & 1,040 \\ \hline Other income (loss)-net & 833 & 34 \\ \hline Income before taxes & 9,662 & 10,691 \\ \hline Income taxes & 1,963 & 1,785 \\ \hline Consolidated net income & $7,699 & $8,906 \\ \hline \end{tabular} \begin{tabular}{|c|c|c|} \hline \multicolumn{3}{|c|}{THECOCA-COLACOMPANYANDSUBSIDConsolidatedBalanceSheets($millions)} \\ \hline December 31 & 2020 & 2019 \\ \hline \multicolumn{3}{|l|}{ Assets } \\ \hline \multicolumn{3}{|l|}{ Current assets } \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1,755 & 1,454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline \end{tabular} 2. Interpret your results for Coca Cola in comparison to those of PepsiCo (which follow). Following are summarized 2020 and 2019 income statements and balance sheets for The Coca-Cola Company. \begin{tabular}{|c|c|c|} \hline cumen & & \\ \hline Cash and cash equivalents & $6,734 & $6,421 \\ \hline Short-term investments & 1.755 & 1,454 \\ \hline Marketable securities & 2,327 & 3,199 \\ \hline Trade accounts receivable, net & 3,116 & 3,935 \\ \hline Inventories & 3,237 & 3,349 \\ \hline Prepaid expenses and other assets & 1,899 & 1,869 \\ \hline Total current assets & 19,068 & 20,227 \\ \hline Equity method investments & 19,100 & 18,854 \\ \hline Other investments & 805 & 846 \\ \hline Other assets & 6,128 & 6,020 \\ \hline Deferred income tax assets & 2,438 & 2,390 \\ \hline Property, plant, and equipment, net & 10,680 & 10,740 \\ \hline Trademarks with indefinite lives & 10,301 & 9,183 \\ \hline Goodwill & 17,348 & 16,613 \\ \hline Other intangible assets & 643 & 729 \\ \hline Total assets & $86,511 & $85,602 \\ \hline Liabilities and equity & & \\ \hline Current liabilities & & \\ \hline Accounts payable and accrued expenses & $11,045 & $11,210 \\ \hline Loans and notes payable & 2,163 & 10,895 \\ \hline Current maturities of long-term debt & 481 & 4,215 \\ \hline Accrued income taxes & 781 & 410 \\ \hline Total current liabilities & 14,470 & 26,730 \\ \hline Long-term debt & 39,764 & 27,268 \\ \hline Other liabilities & 9,368 & 8,433 \\ \hline Deferred income tax liabilities & 1,817 & 2,263 \\ \hline Total liabilities & 65,419 & 64,694 \\ \hline Total equity & 21,092 & 20,908 \\ \hline Total liabilities and equity & $86,511 & $85,602 \\ \hline \end{tabular}