The notes that accompany a companys financial statements provide informative details that would clutter the amounts and

Question:

The notes that accompany a company’s financial statements provide informative details that would clutter the amounts and descriptions presented in the statements. Refer to the financial statements of PepsiCo, Inc. and the Notes to Consolidated Financial Statements in Appendix A.

Instructions

Answer the following questions. Complete the requirements in millions of dollars, as shown in PepsiCo’s annual report.

(a) What did PepsiCo report for the amount of inventories in its consolidated balance sheet at December 29, 2007? At December 30, 2006?

(b) Compute the dollar amount of change and the percentage change in inventories between 2006 and 2007. Compute inventory as a percentage of current assets at December 29, 2007.

(c) How does PepsiCo value its inventories? Which inventory cost flow method does PepsiCo use? (See Notes to the Financial Statements.)

(d) What is the cost of sales (cost of goods sold) reported by PepsiCo for 2007, 2006, and 2005? Compute the percentage of cost of sales to net sales in 2007.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...