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Operating Leverage for Pepsi and Coca-Cola

In its 2006 annual report, the coca-cola company reported sales of $24.09 billion for fiscal year 2006 and 23.10 billion for fiscal year 2005. The company also reported operating income of 6.31 billion, and $6.09 billion in 2005 and 2006, respectively. Meanwhile,Pepsi, reported sales of $35.14 billion in 2006 and $32.56 billion in 2005. Pespi's operating profit was $6.44 billion in 2006 and %5.92 billion in 2005. Based on these figures,which company had higher operating leverage?

Solution Summary

The solution determines the operating leverage for Pepsi and Coca-Cola.