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?
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?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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)
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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