Question

Prepare vertical common-size income statements for Pepsi Co. Note: Use “Total Sales” and “Total Assets” as the denominators for the income statement, respectively. Compute for 2018, 2017, and 2016.

PEPSI CO
Report Date	2018		2017		2016
Scale	Thousands		Thousands		Thousands
Net revenue	64661000		63525000		62799000
Cost of sales	29381000		28785000		28209000
Gross profit	35280000		34740000		34590000
Selling, general & administrative expenses	25170000		24231000		24735000
Amortization of intangible assets	0		0		70000
Operating profit	10110000		10509000		9785000
Other pension & retiree medical benefits income (expense)	298000		0		0
Interest expense	-1525000		-1151000		-1342000
Interest income & other income	306000		244000		110000
Income before income taxes	9189000		9602000		8553000
Provision (benefit) for income taxes	-3370000		4694000		2174000
Less: net income attributable to noncontrolling interests	-44000		-51000		-50000
Net income	12515000		4857000		6329000
Additional Information
Weighted average shares outstanding - basic	1415000		1425000		1439000
Year end shares outstanding	1409000		1420000		1428000
Cash dividends declared per common share	3.588		3.168		2.96

Please show your work so I can understand what is going on. Thank you!!!

Answer 1

Respected sir/ma'am,

Answer for the above question is:

Report Date	2018 in $	2017 in $	2016 in $	Workings	2018 in %	2017 in %	2016 in %
Net revenue_a	64661000	63525000	62799000	a	100.00	100.00	100.00
Cost of sales_b	29381000	28785000	28209000	b/a	45.44	45.31	44.92
Gross profit_c	35280000	34740000	34590000	c/a	54.56	54.69	55.08
Selling, general & administrative expenses_d	25170000	24231000	24735000	d/a	38.93	38.14	39.39
Amortization of intangible assets_e	0	0	70000	e/a	0.00	0.00	0.11
Operating profit_f	10110000	10509000	9785000	f/a	15.64	16.54	15.58
Other pension & retiree medical benefits income (expense)_g	298000	0	0	g/a	0.46	0.00	0.00
Interest expense_h	1525000	1151000	1342000	h/a	2.36	1.81	2.14
Interest income & other income_i	306000	244000	110000	i/a	0.47	0.38	0.18
Income before income taxes_ j	9189000	9602000	8553000	j/a	14.21	15.12	13.62
Provision (benefit) for income taxes_k	3370000	4694000	2174000	k/a	5.21	7.39	3.46
Less: net income attributable to noncontrolling interests_l	44000	51000	50000	l/a	0.07	0.08	0.08
Net income_m	12515000	4857000	6329000	m/a	19.35	7.65	10.08

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