Answer To: You will use three documents to complete this assignment: ACC 206 Final Paper Breakeven Chart.xls...
Aarti J answered on Mar 18 2021
Accounting Final paper
Financial Analysis of Coca Cola
Course Name
Course Date
Student’s Name
Financial analysis – Coca Cola
Introduction
Coca Cola is one of the biggest beverages company, The company caters to non-alcoholic beverages which includes the sprinkle soft drinks, sports and water drinks, juices, tea and coffee and other energy drinks. The company has its operations across the globe and has different operating segments.
In this paper, we have done the financial analysis of the company for the year 2016 and 2017. We have emphasized on different forms of financial analysis which includes the horizontal analysis, vertical analysis and ratio analysis.
Horizontal Analysis:
In the horizontal analysis, the company analyse its income statement and the balance sheet as comparison from the pervious year.
Horizontal analysis – Income Statement:
THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Year Ended December 31,
2017
2016
%
(In millions except per share data)
NET OPERATING REVENUES
$ 35,410
$ 41,863
-15.41%
Cost of goods sold
13,256
16,465
-19.49%
GROSS PROFIT
22,154
25,398
-12.77%
Selling, general and administrative expenses
12,496
15,262
-18.12%
Other operating charges
2,157
1,510
42.85%
OPERATING INCOME
7,501
8,626
-13.04%
Interest income
677
642
5.45%
Interest expense
841
733
14.73%
Equity income (loss) – net
1,071
835
28.26%
Other income (loss) – net
-1,666
-1,234
35.01%
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME
TAXES
6,742
8,136
-17.13%
Income taxes from continuing operations
5,560
1,586
250.57%
NET INCOME FROM CONTINUING OPERATIONS
1,182
6,550
-81.95%
Income from discontinued operations (net of
income taxes of $47, $0 and $0, respectively)
101
-
CONSOLIDATED NET INCOME
1,283
6,550
-80.41%
Less: Net income attributable to noncontrolling
Interests
35
23
52.17%
NET INCOME ATTRIBUTABLE TO SHAREOWNERS OF
THE COCA-COLA COMPANY
$ 1,248
$ 6,527
-80.88%
Looking at the operations of the company, we can see the company’s performance for the year 2017 was weaker as compared to the year 2016. The company’s profits has decreased, as there is a decrease in the revenues, and overall profitability of the company. The revenues of the company decreased by 15.41% along with the decrease in few expenses. Spme expenses increased like other operating charges, which led to decrease in the net income. The net income for the year decreased by 80.88% in 2017 as compared to 2017.
Horizontal analysis: - Balance Sheet:
THE COCA-COLA COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31,
2017
2016
%
(In millions except par value)
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 6,006
$ 8,555
-29.80%
Short-term investments
9,352
9,595
-2.53%
TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
15,358
18,150
-15.38%
Marketable securities
5,317
4,051
31.25%
Trade accounts receivable, less allowances of $477 and $466,
Respectively
3,667
3,856
-4.90%
Inventories
2,655
2,675
-0.75%
Prepaid expenses and other assets
2,000
2,481
-19.39%
Assets held for sale
219
2,797
-92.17%
Assets held for sale - discontinued operations
7,329
-
TOTAL CURRENT ASSETS
36,545
34,010
7.45%
EQUITY METHOD...