Instructions Use ONLY the data provided in this exam to answ

Instructions: Use ONLY the data provided in this exam to answer the questions below. Required Compute the five component ratios of a decomposition of ROE for Pepsico\'s fiscal years 2013-2017 (present your results) 1. 2. What patterns do you see? segments (present your results). 4. What patterns do you see? 5. Compute the operating margin for each of Pepsico\'s segments (present your results). 6. Compute the year-to-year change in operating margin for each of Pepsico\'s segments (present your results). 7. What patterns to you see? 8. Which segment(s) are positively (negatively) influencing Pepsico\'s recent performance? 9. What does your analysis indicate regarding Pepsico\'s future performance? To facilitate your analysis, the data below are inserted into this document as an Excel Objects. The images appear fuzzy\" but clicking on the data should cause it to open in an Excel spreadsheet. If, however, a spreadsheet does not open, you will have to enter the data manually. The data is also included as a \"picture.\" Be careful in doing so, to insure the accuracy of your inputs.

Solution

down on the expenses in the COGS ,S& D and depreciation .

I have answered the First Four questions as per the chegg policy.

1	The Five Components of decomposition of ROE for Pepsico for years 2013-2017 is as follows:
	ROE	EBIT Margin*Interest Burden * Tax Burden*Asset Turnover *Equity Multiplier
	Fiscal Year Ending			2013	2014	2015	2016	2017
				Dec	Dec	Dec	Dec	Dec
	Operating income After Dep			12584000	12658000	12465000	12698000	13189000
	Sales Net			66415000	66683000	63056000	62799000	63525000
	EBIT Margin			0.1894753	0.1898235	0.197681426	0.202200672	0.207619
	Interest Expense			911000	909000	970000	1109000	1151000
	Interest Burden			13.813392	13.925193	12.85051546	11.44995491	11.45873
	Tax Burden	Net Income/Pretax Profit*Pretax Profit /EBIT
	Adjusted Available for Common		6732000	6503000	5446000	6323000	4853000
	Pretax Income			8891000	8757000	7442000	8553000	9602000
	Operating income After Dep			12584000	12658000	12465000	12698000	13189000
	Therefore Tax Burden			0.534965	0.5137462	0.436903329	0.497952433	0.367958
	Asset Turnover
	Sales/Asset			0.8572111	0.9457374	0.905105717	0.847158332	0.796013
	Sales Net			66415000	66683000	63056000	62799000	63525000
	Asset			77478000	70509000	69667000	74129000	79804000
	Equity Mutiplier			3.17676	4.0180647	5.791105569	6.619251719	7.267462
	Asset			77478000	70509000	69667000	74129000	79804000
	Equity			24389000	17548000	12030000	11199000	10981000
	ROE			3.8128564	5.1604472	5.817448646	6.464690144	5.064131
2	The following patterns are observed over the Periods
	The lower interest rate followed by the lower tax burden and the increase in the asset turnover ratio and the equity multiplier is the cause for
	the improvement in the ROE over the periods from 2013-2017
3	The YOY changes in Revenue and Operating Profit for all the segments of Pepsico is as follows
	This is calculated on the assumption of 12 week Period data that is given in the problem
	12 Week Period	9/5/2015	12/26/2015	Total for 2015	3/19/2016	6/11/2016	9/3/2016	12/31/2016	Total For 2016	YOY of 16 Over 15	3/25/2017	6/17/2017	9/19/2017	12/30/2017	Total For 2017	YOY of 17 Over 16	3/24/2018	6/16/2018	Total for 2018	YOY of 18 Over 17
	Net Revenue
	Total By Segments	16331	18585	34916		11862	15395	16027	19515	62799	0.798574	12049	15710	16240	19526	63525	1.011561	12562	16090	28652	-0.54896
	Operating Profit
	Total By segments	1416	2240	3656		1619	2964	2821	2381	9785	1.676422	1863	2919	2993	2593	10368	1.059581	1807	3028	4835	-0.53366
4	Based on the 12 week period data given for the segments which is not the whole data for a year we can find that the YOY growth for revenue and Operating profit of 2017 over 16 is more than 1 which implies that the revenue is increasing and also the operating profits .So the company is cutting
	down on the expenses in the COGS ,S& D and depreciation . I have answered the First Four questions as per the chegg policy.