Financial analysis

Financial analysis

  • Submitted By: Oleg-Ripa
  • Date Submitted: 05/16/2014 2:08 PM
  • Category: Business
  • Words: 1298
  • Page: 6
  • Views: 6

Coca-Cola Financial Analysis

Coca-Cola Financial Analysis
This analysis will examine the financial statements of the Coca-Cola Company and utilize comparative and ratio analyses to best assess the company’s liquidity, profitability, and overall financial health. Liquidity refers to the ability of a company to access cash and meet near-term obligations, whereas profitability refers to a company’s capacity to turn a profit.
Examining comparative financial data extrapolated from financial statements will help determine

both the current financial position and predictive prospects of Coca-Coca Company. The

following will evaluate these prospective terms using specific liquidity and profitability

ratios, as well as comparative measures of vertical and horizontal analyses.


Liquidity is an important financial measurement of a company’s capacity to pay current

obligations and have available cash to keep operations going. When we look at the liquidity of

Coca-Cola, three of the ratios stand out as being most notably important to financial analysis of

the company’s liquidity. These significant measures include current ratio, quick ratio and the

cash ratio. Current ratio, calculated by (current assets/current liabilities), measures a company’s

ability to pay current obligations with current assets. As we look at the current ratio, we can see

that the highest in the past five years was in 2009 at 1.28 and the lowest was in 2011 at 1.05, but

since 2011, it has increased to 1.13 so it would look as if the current ratio is on the rise. Quick

ratio, calculated by ({cash + cash equivalents + market securities + accounts receivable}/current

liabilities), provides a tighter measurement on a company’s capacity to meet current obligations.

When looking at the quick ratio we can see that the highest again was back in 2009 at 0.95 and

the lowest was in 2012 at 0.77. When we look at 2013,...

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