PepsiCo, Inc. (PEP), the parent company of Frito-LayTM snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years:   Year 2 (in millions) Year 1 (in millions) Cash and cash equivalents $ 9,096   $ 6,134   Short-term investments, at cost 2,913   2,592   Accounts and notes receivable, net 6,437   6,651   Inventories 2,720   3,143   Prepaid expenses and other current assets 1,865   2,143   Short-term obligations (liabilities) 4,071   5,076   Accounts payable and other current liabilities 13,507   13,016   a.  Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.   Year 2 Year 1 Current ratio fill in the blank 1 fill in the blank 2 Quick ratio fill in the blank 3 fill in the blank 4   b.  What conclusion can be drawn from these data?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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PepsiCo, Inc. (PEP), the parent company of Frito-LayTM snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years:

  Year 2
(in millions)
Year 1
(in millions)
Cash and cash equivalents $ 9,096   $ 6,134  
Short-term investments, at cost 2,913   2,592  
Accounts and notes receivable, net 6,437   6,651  
Inventories 2,720   3,143  
Prepaid expenses and other current assets 1,865   2,143  
Short-term obligations (liabilities) 4,071   5,076  
Accounts payable and other current liabilities 13,507   13,016  

a.  Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.

  Year 2 Year 1
Current ratio fill in the blank 1 fill in the blank 2
Quick ratio fill in the blank 3 fill in the blank 4

 

b.  What conclusion can be drawn from these data?
 

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