Accounting for the Non-Finance Manager/Owner

Selected balance sheet amounts for PepsiCo, a manufacturer of soft drinks and snacks, for four years appear
below (in millions):

Year x5 Year x6 Year x7 Year x8

Total Assets $ 22,660 ?? ?? $ 21,695

Non-current Liabilities 8,345 $ 6,882 ? 8,023
Non-current Assets ? ? 13,378 $ 13,735 ?
Total Liabilities and Shareholders’ Equity ?? 17,551 ? ??
Current Liabilities 7,914 ??
4,998
Shareholders’ Equity ?? 6,881 7,249 ??
Current Assets 4,362 ??
5,853

1. Determine the missing amounts for each of the four years.

2. How did the mix of total assets (i.e., the proportion of current versus total assets) change over the four
years? What might account for such a change?

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 Accounting for the Non-Finance Manager/Owner
3. How did the mix of current liabilities, non-current liabilities, and shareholders’ equity change over the four
years? What might account for such a change?
From the financial statements data (rounded Philippine Pesos) of C Enterprises shown below, explain as
extensively as possible how the company performed over the four years.

Year 9 Year 10 Year 11 Year 12

Average total assets 1,000 1,160 1,333 1,517

Average owners' equity 500 592 694 809
Net income 160 180 200 220
Sales 2,000 2,250 2,500 2,750

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 Accounting for the Non-Finance Manager/Owner
Three companies have the following condensed financial data (in million Philippine Pesos):

AA BB CC

Average equity 29,769 5,118 744

Average total assets 77,107 10,885 1,532
Sales 28,947 13,640 9,717
Net income 2,916 523 149

Identify and explain as fully as possible which company was the most successful in utilizing its resources.

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 Accounting for the Non-Finance Manager/Owner
Financial data about two well-known American multinationals reveal the following for a certain year (in million
dollars). As the given information can allow, comment fully on the companies’ profitability.

Company 1 Company 2

Revenues 10,236 17,803

Interest Expense 231 1,134
Net Income 1,382 1,091
Total Assets (average) 8,780 10,135

One of the companies engages primarily in soft drinks, while the other’s activities include soft drinks, food
snacks and restaurants. The income tax rate for the year was 34 percent.

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 Accounting for the Non-Finance Manager/Owner
You are deciding which equipment to use in operations. The following relate to the options.

Lo-Tech Hi-Tech

Annual rental PHP 24,000 PHP 48,000

Other annual fixed costs 100,000 120,000

You expect unit variable costs of your product to be PHP 44 using Lo-Tech, and PHP 35 with Hi-Tech.

Assuming other factors to be unaffected by the choice of equipment, indicate and explain which type you would
select for the coming year (the annual rental agreement in either case being non-cancelable). Base your answer
on quantified terms only.

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