Coca-Cola and Pepsi Pension
Running head: Coca-Cola and Pepsi Pensions
Laila Nayani
Professor: William Blix
ACC: 305
Abstract
In this paper I will cover the comparative analysis case study of the pension plans offered by the Coca-Cola Company and PepsiCo, Inc. I will compare the pension plans of both of these entities and indicate the types of plans they offer as well as the funded status of each at2009 year end. Furthermore, I will calculate the relevant rates that were used by Coca-Cola and PepsiCo in computing their pension amounts. Additionally, I will determine and justify which company I would rather invest in if I were a potential shareholder.
The Coca-Cola Company versus PepsiCo, Inc each organization offers and sponsors 401K pension plans as well as medical and life insurance benefit plans for their employees or associates. Not all employees are eligible for participation in all plans. Coca Cola has a defined contribution plan that includes all U.S. employees and some international employees. This is a contributory plan; both the employer and the employee make contributions. This plan offers substantial tax benefits for the contributions made by the employer. In addition, Coca Cola also has a defined benefit pension plan. This plan is considered a nonqualified, unfunded plan primarily for the organizations officers, most U.S. employees, and some international employees. This plan offers no tax benefits for contributions made by the organization. In 2009, Coca Cola amended this plan to reduce exposure.
PepsiCo, Inc. has a voluntary
Laila Nayani
Professor: William Blix
ACC: 305
Abstract
In this paper I will cover the comparative analysis case study of the pension plans offered by the Coca-Cola Company and PepsiCo, Inc. I will compare the pension plans of both of these entities and indicate the types of plans they offer as well as the funded status of each at2009 year end. Furthermore, I will calculate the relevant rates that were used by Coca-Cola and PepsiCo in computing their pension amounts. Additionally, I will determine and justify which company I would rather invest in if I were a potential shareholder.
The Coca-Cola Company versus PepsiCo, Inc each organization offers and sponsors 401K pension plans as well as medical and life insurance benefit plans for their employees or associates. Not all employees are eligible for participation in all plans. Coca Cola has a defined contribution plan that includes all U.S. employees and some international employees. This is a contributory plan; both the employer and the employee make contributions. This plan offers substantial tax benefits for the contributions made by the employer. In addition, Coca Cola also has a defined benefit pension plan. This plan is considered a nonqualified, unfunded plan primarily for the organizations officers, most U.S. employees, and some international employees. This plan offers no tax benefits for contributions made by the organization. In 2009, Coca Cola amended this plan to reduce exposure.
PepsiCo, Inc. has a voluntary
References: Kennon, Joshua (2011). Adjusting Pension Assumptions to Manipulating Earnings, How to SpotSigns of Aggressive Accounting, Retrieved August 13, 2011, from the web site:http://beginnersinvest.about.com/od/gaap/a/aa090704.htmKieso, D.E., Weygandt, J.J., & Warfield, T.D. (2010). Comparative Analysis Case; The Coca Cola Company versus PepsiCo, Inc. Intermediate Accounting III, 13th Edition