Coca-Cola and PepsiCo are two of the largest and most successful beverage companies in the...
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Accounting
Coca-Cola and PepsiCo are two of the largest and most successful beverage companies in the world in terms of the products that they sell and their receivables management practices. To evaluate their ability to collect on credit sales, consider the following information assumed to have been reported in their 2020, 2019, and 2018 annual reports (amounts in millions).
Fiscal Year Ended:
2020
2019
2018
2020
2019
2018
Net Sales
$
31,884
$
28,957
$
24,488
$
45,251
$
41,074
$
35,537
Accounts Receivable
3,181
3,428
2,690
3,824
3,710
3,187
Allowance for Doubtful Accounts
59
60
67
74
73
68
Accounts Receivable, Net of Allowance
3,122
3,368
2,623
3,750
3,637
3,119
Required:
1. Calculate the receivables turnover ratios and days to collect for Coca-Cola and PepsiCo for 2020 and 2019. (Consider a 365 days a year. Round your intermediate answers and final answers to 1 decimal place.)
2020Coca-ColaPepsiCo
Receivables turnover ratiotimestimes
Days to collectdaysdays
2019Coca-ColaPepsiCo
Receivables turnover ratiotimestimes
Days to collect
Which of the companies is quicker to convert its receivables into cash?
Answer & Explanation
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