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Determine the current ratio and quick ratio for both years

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Reference no: EM131912485

Question - PepsiCo, inc., the parent company of Frito-Lay snack foods and Pepsi beverages, had the following current assets and current liabilities at the end of two recent years.

December 31,2005 December 25,2004 (in millions) (in millions)

Cash and cash equivalents $1,716 $1,280

Short-term investments, at cost 3,166 2,165

Accounts and notes receivable (net) 3,261 2,999

Inventories 1,693 1,541

Prepaid exp. and other current assets 618 654

Short-term obligations 2,889 1,054

Acc. payable and other current liabilities 5,971 5,999

Income taxes payable 546 99

a. Determine the (1) current ratio and (2) quick ratio for both years. Round to one decimal place.

b. What conclusions can you draw from these data?

Reference no: EM131912485

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