Financial Management

Financial Management

Financial Management

Yamil Little

Strayer University

BUS508

Dr. John Theodore

12/12/10

Financial Management

“A people that values it privileges above its principles soon loses both.” – Dwight Eisenhower

Introduction

The country has been through a lot of soul searching during this current economic crisis. On the business community and government level the goal is to find the source of the world’s financial problems. Many feel it is the overspending of government that has led to our country’s current economical state. While others feel it is the lack of leadership coupled with arrogance that has played a major role. Without the faith and trust of today’s investors many company’s have embarked on a mission to regain those lost qualities.

PepsiCo and Coca-Cola Enterprises are some of the company’s that are on the path of rebuilding trust in U.S. Business but that is not enough for today’s investors. It is important for company’s to have transparency so the average investors can actually see for themselves if each company is living up to this commitment. It is also important for the investors to understand financial reports such as an Income Statement and Balance Sheet within a company’s annual report in order to maintain accountability. In this paper, using the Income Statement and the Balance Sheet of PepsiCo and Coca-Cola Enterprises, I will find each company’s current ratio and make some conclusions about their ability to pay current liabilities.

Using the profitability ratio, I will discuss what conclusions one can make about each company’s profits over the past three years. Using the cash flow indicator and investment valuation ratios, I will discuss which company is more likely to have satisfied stockholders. I will also give my rationale for which company I would choose to invest in. Lastly, I will discuss some non-financial reasons I would apply when choosing between PepsiCO and...