Final Project: Financial AnalysisThe best way to determine whether to invest in a company is to examine the company's financial statements. The purpose of this article is to do a financial analysis and discuss the annual reports of two of the leading beverage companies, PepsiCo, Inc. and Coca-Cola Company, particularly the consolidated income statements and balance sheets of each company. PepsiCo, Inc. and Coca-Cola Company manufacture and sell bottled water, energy drinks, bottled teas and soft drinks worldwide. Over the years, many companies have entered the soft drink industry, but PepsiCo, Inc. and Coca-Cola Company continue to dominate as leaders in this industry. Many of their drinks are sold at dine-in and take-out restaurants. It is of the utmost importance when operating a business or enterprise that all financial statements are accurate. Accurate financial data is necessary to get a good idea of ​​how the company manages its revenue and show its past performance. This information is useful to company managers, investors who may invest in the company, and creditors who may extend credit to the company. Financial information is also useful for the company to acquire revenue in the future. PepsiCo, Inc., best known for its best-selling cola, Pepsi, and Coca-Cola Company, best known for its popular soda, Coke, topped the rankings. places in the beverage industry for decades in the domestic market and also in the international market. Both companies sell their products worldwide. They strategically followed a business plan that kept them at the top and created a gap between their company and others...... middle of paper ......experienced companies in 2005 dropping their net profits compared to the previous year of 2004, and they both also showed an increase in operating expenses, which resulted in a decline in net profits. They both posted higher operating expenses in 2005 than in 2004 and are expected to modify or adjust their operations to help reduce expenses so their profit margins begin to increase. I have financially analyzed PepsiCo, Inc. and Coca-Cola Company in this final document. . Both companies have been around for many years and dominate the beverage industry market. The vertical analysis and horizontal analysis of each company revealed different financial situations for each company. Every business has experienced a period of financial profit and a period of financial loss. ReferencesWeygandt, J., Kimmel, P. and Kieso, D. (2008). Financial accounting. Hoboken, New Jersey: Wiley.