Financial Statement Analysis of PepsiCo

Some of these documents used are the income statement, cash flow statement, balance sheet and form 10-k. The shareholders and investors can benefit from these reports since they are capable of viewing the financial status of a company. Through this reports it’s possible to compare the performance of the company in each year to indicate whether the trends are either positive or negative. Financial statements are supposed to be understood effectively since they contain information that is very crucial to investors. This information can assist them to come up with the best financial decision that can result to a greater change in their future. The company is ranked among the highest in the Fortune 500 companies. PepsiCo Company has a competitor which is the Coca-Cola Company and this firm has fully maintained its position of providing non-alcoholic products.

PepsiCo Company PepsiCo Corporation has the most popular and huge portfolio that generates billion-dollar brands beverages and food globally. The company produces 19 different brands and the total sale of each brand every year equals $1 billion in retail sales. PepsiCo Corporation is capable of generating nearly $60 billion total revenue annually, due to this the company is committed and united to sustainable growth and it usually performs with a purpose. Current ratio Operating efficiency In any case, where a company wants to measure the ability to use its assets and manage its liabilities in an effective and efficient way, it must apply the efficiency ratios. The most common efficiency ratios include the asset and inventory turnover ratios. A company is considered to be in a better position if only the inventory ratio is higher.

The inventory turnover of PepsiCo Company was 0. 98 in 2015 and 0. As a manager, it’s always recommendable to use the profitability ratios in order to identify profits in a company. Epstein, (2014) reported that these ratios can be applied by managers in a company to test the profitability. Therefore they will be able to know whether certain objectives have been achieved. Furthermore, through this ratios, a company has a full potential to compare its profitability with its competitor and this will act as a benchmark to estimate their victory in the industry. The performance of a company can be measured effectively using the financial ratios. Moreover, this type of information motivates creditors to make a proper decision in a case where an organization has asked for a particular amount.