The following financial information (in US$ millions) is for two major corporations for the three years ended December 31:

Instructions
a. Calculate the inventory turnover, days sales in inventory, and gross profit margin for each company for 2019 and 2018.
b. Comment on your findings.

Taking It Further

Companies are required to disclose in a significant accounting policies note how they determine the cost of their inventory. Both Pepsi and Coca-Cola state that they use weighted average and FIFO. Under what circumstances would it make sense for a company to use both cost formulas?

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PepsiCo, Inc. Net sales Cost of sales Profit for the year Inventory Coca-Cola Company Net sales Cost of sales Profit for the year Inventory 2019 $67,161 30,132 7,314 3,338 $37,266 14,619 8,920 3,379 2018 $64,661 29,381 12,515 3,128 $34,300 13,067 6,434 3,071 2017 $63,525 28,796 4,857 2,947 $36,212 13,721 1,248 2,655