Complete this template by replacing the bracketed text with the relevant information.

Debt-to-Assets Ratios

1. Calculate the quality of the debt-to-assets ratios for both companies.

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2. Explain the quality of the debt-to-assets ratios for both companies.

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3. Determine which company is more highly leveraged.

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Times-Interest-Earned Ratios

1. Calculate the times-interest-earned ratios for both companies.

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2. Explain the times-interest-earned ratios for both companies. Address the following questions in

your response:

A. Are the times-interest-earned ratios adequate?

B. Is the times-interest-earned ratio greater than or less than 2.5? What does that mean

for the companies' income?

C. Can the company afford the interest expense on a new loan?

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Foreign Debt

1. Explain why The Coca-Cola Company and PepsiCo, Inc. may use foreign debt to finance their

operations.

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2. Explain the risks involved in using foreign debt to finance operations.

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References

Include any references used to complete this assignment. This section is for the full citation. Sources

should be cited using APA style.

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