You are considering making a loan to The Coca-Cola Company. The following information is from the financial statements included in Form 10-K for fiscal years 2011 and 2010 (in millions of dollars):
Net operating revenues for the year ended:
December 31, 2011 .........................................    $46,542
December 31, 2010 .........................................      35,119
Trade accounts receivable, less allowances of $83, $48, and $55, respectively:
December 31, 2011 .........................................        4,920
December 31, 2010 .........................................       4,430
December 31, 2009 .........................................       3,758
The following information is from the financial statements included in Form 10-K for fiscal years 2011 and 2010 for PepsiCo, Inc. (in millions of dollars):
Net revenue for the year ended:
December 31, 2011 .........................................   $66,504
December 25, 2010 .........................................     57,838
Accounts and notes receivable, net:
December 31, 2011 .........................................       6,912
December 25, 2010 .........................................       6,323
December 26, 2009 .........................................       4,624

Required
Part A. The Ratio Analysis Model
A lender must assess how well a company is managing its accounts receivable before making a loan. The accounts receivable turnover ratio tells us how many times in a year a company collects its receivables. Replicate the five steps in the Ratio Analysis Model on page 344 to analyze the accounts receivable turnover ratios for The Coca-Cola Company and PepsiCo:
1. Formulate the Question
2. Gather the Information from the Financial Statements
3. Calculate the Ratio
4. Compare the Ratio with Other Ratios
5. Interpret the Ratios
Part B. The Business Decision Model
A lender must consider a variety of factors, including financial ratios, before making a loan. Replicate the five steps in the Business Decision Model on page 346 to decide whether to loan money to The Coca-Cola Company:
1. Formulate the Question
2. Gather Information from the Financial Statements and Other Sources
3. Analyze the Information Gathered
4. Make the Decision
5. Monitor Your Decision