Accouning
sony.tayqACC 100 - Assignment
I have provided the Income Statement and Balance Sheet for the Coca-Cola Company for the year 2013. From Exhibit 17.16 on Page 737 of Chapter 17 of the textbook, your job is to calculate the financial ratios for the Coca-Cola Company. In addition, you are to compare the performance of Coca-Cola to the industry. For each ratio, comment on why it might be viewed as favorable or unfavorable relative to the industry . Once you have completed the financial ratio analysis describe whether or not it would be to our advantage to invest in this company . FOR FULL CREDIT, PLEASE SHOW ALL OF YOUR WORK! (160 points)
For Liquidity and Efficiency; calculate all ratios EXCEPT the “Acid-Test” ratio.
For Solvency; calculate ONLY the “Debt” ratio.
For Profitability; calculate all of the ratios EXCEPT the “Book Value per Common Share” and the “Basic Earnings per Share.”
There are 11 financial ratios to be calculated!
Industry Ratios |
Median |
Current Ratio |
2.50 |
Days’ Sales Uncollected |
30 days |
Days’ Sales in Inventory |
60 days |
Total Asset Turnover |
18 |
Inventory Turnover |
8 |
Accounts Receivables Turnover |
12.5 |
Debt Ratio |
70% |
Gross Margin Ratio |
40% |
Profit Margin Ratio |
8% |
Return on Total Assets |
12.5% |
Return on Common Stockholders’ Equity |
14.0% |