FinancialAnalysisReportofthePepsico百事可乐的财务分析作业.docx

FinancialAnalysisReportofthePepsico百事可乐的财务分析作业.docx

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FinancialAnalysisReportofthePepsico百事可乐的财务分析作业

FinancialAnalysisReportofthePepsi

Student1:

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Student2:

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May24,2012

Contents

Preface

ThisfinancialanalysisreportofPepsiismainlyfocusontheprobabilityandefficiencyratiocalculations,aswellasthesimplecomparisonwiththeCocaColaCompany.Inaddition,thedataofthisreportiscollectedfromtheannualreportin2007.

Part1FinancialStatementofthePepsi

IncomeStatementofPepsi

FiscalyearsendedDec.29,2007,Dec.30,2006andDEC.31,2005

ThestatementofcashflowofPepsi

FiscalyearsendedDec.29,2007,Dec.30,2006andDEC.31,2005

BalancesheetofPepsi

FiscalyearsendedDec.29,2007,Dec.30,2006

ThestatementofCommonShareholders’Equity

FiscalyearsendedDec.29,2007,Dec.30,2006

Part2FinancialAnalysisofPepsi

Dollarandpercentagechanges

Thedollarandpercentagechangesoftheassets,liabilitiesandequitiesinbalancesheetareshowninsheetasfollow.

2006isthebaseyearincalculation.Fromtheresultsofthecalculationwecaneasilyknowthetotalcurrentassetsariseby11.2%,totalassetsariseby15.7%,totalliabilitiesandequityariseby15.7%,sothecompanyactuallydidn’timprovesomuch.Besides,wecanknowthecashequivalentdecreasedby44.8%whiletheshort-terminvestmentariseby34.2%,whichmeansthatthecompanyconvertthecashtoshortinvestmentorotherplans.

Trendpercentagesoftrendanalysis

Theseratiosduringthreeyearsrevealpatternsindatawhichcoverssuccessiveperiod.Fromthegraphwecaneasilyknowtheexpense,cost,andrevenueareallgrow,butthesalescostandexpensesgrowsfasterthanrevenue.

Weusethetrendpercentagestoconstructagraphtoseethetrendoverthisthreeyears.

Componentpercentage

i）Common-sizedpercentagesinBalancesheetofPepsi

ii）Common-sizedpercentagesinIncomestatementofPepsi

Ratios

Alongwithdollarandpercentageschanges,trendpercentages,andcommon-sizedpercentages,ratioscanbeusedtocomparepastperformanceandothercompaniestoourcompany.SomeratiosofPepsiarecalculatedheretoanalyze.

Profitability

WewillusetheinformationasfollowtocalculatetheprofitabilityratioforPepsiin2007andsomeresultsarecalculatedinthetable.

ProfitabilityRatioscalculation:

ProfitMargindescribestheabilitytoearnnetincomefromeachsalesdollar,fromthecalculatedresultweknowtheabilityofitisnotverywell,andwecaninformthatthePepsiearnincomemainlybyagreatamountsofsales.ROAwith0.222isagoodsignalthatthePepsihasagoodprofitability.TheROE,EPS,andPEallshowthatthePepsiisagoodprofitablecompany.

Liquidity

WewillusetheinformationasfollowtocalculatetheliquidityratioforPepsiin2007andsomeresultsarecalculatedinthetable.

c

LiquidityRatioscalculation:

ThePepsihaspositiveworkingcapitalwhichmeansthatthecurrentassetsexcessescurrentliabilities.Besides,currentratio,quickratio,andacid-testratioallhavebigvalue,sothePepsihasagoodliquidity.

Solvency

WewillusetheinformationasfollowtocalculatethesolvencyratioforPepsiin2007andsomeresultsarecalculatedinthetable.

Fromtheratioswecanseedebt-to-equityratioissmall,sothecompanyhasmoreopportunitytoexpandthroughofdebtfinancing.

Efficiency

Wewillusetheinformationasfollowtocalculatethesolvencyratioforefficiencyin2007andsomeresultsarecalculatedintheexcel.

Totalassetturnoverwith1.2223showsthatthePepsihasadegreeabilitytouseitsassetstogeneratesales.AccountsreceivableturnoverratemeansthePepsineeds9.73timestoconvertsitsreceivableintocasheachyear.Inaddition,thecompanycollectsitsaccountsreceivablewiththefrequencyof0.111,andsalesandreplacesitsmerchandiseinventory8.557timeseachyear.Fromtheday’ssaleininventoryweknowthedemandedproductishardtosellforittakes46.338timestomakeit.However,thePepsiisefficientcompanyoverall.

PART3ComparisonbetweenPepsiandCocaCola

HerewemakeacomparisonbyprofitabilityandefficiencyratiosbetweenPepsiandCocaCola.

ThedataofCocaColaisasfollow.

Profitabilityratioscomparison

FromthetableaboveweknowthattheProfitMarginofCocaColaislargerthanPepsi,whichmeansthatCocaColahasagreatabilitytoearnincomethanPepsi.Besides,theROAofCocaColaisalsobiggerthanPepsi.ButtheearningpershareandROEissmallerthanthePepsi.SoweknowthatCocaColahasagreatprofitabilitythanPepsi,whilePepsicangaingreaterincometoitsshareholders.

Efficiencyratiocomparison

FromthetablewegettheinformationthattheTotalAssetsTurnover,InventoryTurnoverrate,andofPepsiarebiggerthanCocaCola.Inaddition,theDays’salesInInventoryofCocaColaismuchbiggerthanPepsi.AlltheseinformationshowthatthePepsiismoreefficient.

PART4ReviewreportaboutAccountingcourseandsomesuggestionstothecourse

ReviewreportaboutAccountingcourse

Accountingiscrucialinourinformationage.InourAccountingcourse,wediscussedtheimportanceofaccountingtodifferenttypesoforganizationanddescribedtheacceptdaccountingprinciples.Atthesametimewelearnedthefinancialstatementsandmasteredthemethodtomakejournalentries.What’smore,welearnedtheadjustmenttojournalentiesandclosingtheaccountingcycle.Duringthelastsemi-termwefocusedonthedetailsofassets,liabilitiesandequity.Thewholeprocedureofaccountingcoursewasverymeaningfulandusefulthoughitsometimesmightbehardanddull.

Somesuggestions

Theaccountingcourseisgoodoverall.However,therearestillsomedetailsthatbothteacherandstudentneedtomakeimprovement.

Firstly,Ithinktheexamsinclassisagoodmethodtoevaluatethestudent,anditishelpfulforustoconsolidatetheknowledge,soitshouldbereservedincontinueteaching.Secondly,wehavehomeworkeveryweek,wedon’tneedtosubmititeveryweekthough.Ithinkitwillbebetterifwesubmitthehomeworkeveryweekbecausewehavedeadlinethenandmayspendmoretimeinit.Thirdly,everytimewetookthefirstpartoftheclassweallfelttiredbecausethispartofclasslastnearlyoneandohalfhours.Idon’tthinkitisaefficientmethodtoteaching,insteadof,thefirstpartoftheclassshouldbeshorterandthenwecanhave10minutesrestingtime,asaresultofitwemayhaveagreatstatetotakethelessons.

Reference

[1]Pepsico2007AnnualReport

[2]CocaCola2007AnnualReport