PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had thefollowing current assets and current liabilities at the end of two recent years: Current Year Previous Year (in millions) (in millions)Cash and cash equivalents $ 6,297 $ 4,067Short-term investments, at cost 322 358Accounts and notes receivable, net 7,041 6,912Inventories 3,581 3,827Prepaid expenses and other current assets 1,479 2,277Short-term obligations 4,815 6,205Accounts payable 12,274 11,949a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.b. What conclusions can you draw from these data about PepsiCo’s liquidity?
PepsiCo, Inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the
following current assets and current liabilities at the end of two recent years:
Current Year Previous Year
(in millions) (in millions)
Cash and cash equivalents $ 6,297 $ 4,067
Short-term investments, at cost 322 358
Accounts and notes receivable, net 7,041 6,912
Inventories 3,581 3,827
Prepaid expenses and other current assets 1,479 2,277
Short-term obligations 4,815 6,205
Accounts payable 12,274 11,949
a. Determine the (1)
b. What conclusions can you draw from these data about PepsiCo’s liquidity?
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