unusual_gains_and_losses

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Case Study: PepsiCo, Inc. Unusual Gains and Losses
The selected firm is PepsiCo, Inc in the food industry. The company has in the recent past made pronouncements on an irregular item pertaining to the unusual gains and losses. PepsiCo, Inc. has been faced by stiff competition from the Coca-Cola products since the early 2000s and as a result, it has tried different means to remain in the industry. The firm incurred restructuring and impairment charges from 2014 into its Productivity Plan. The plan received $357 million, $169 million and $160 million in 2014, 2015 and 2016 respectively. This plan is expected to strengthen the snack, food and beverage business. It is an additional Productivity Plan from the 2012 Productivity Plan aimed at accelerating growth. The restructuring and impairment charges mostly fall under the severance and other employee-related costs, impairments of assets, contract termination costs and other costs relating to implementation initiatives.
These charges have been incorporated into the selling, general and administrative expenses in the statement of income and expected to be incurred until Dec 2017. The restructuring and impairment charges do not fall under the extraordinary activities due to its restrictive nature. This charges related to a reorganization of PepsiCo, Inc. like the laying off employees to cut down on the costs of production. The firm had tried a different approach to cater for the rising costs by increasing the price of the product which did not go well with the customers leaving them no other option that to cut the costs of production.

The Productivity Plans has proved pivotal for PepsiCo as the 2012 plan has enhanced the firm cost-competitiveness and has also provided funds for the future creation of brands and innovation initiatives.
Work Cited
PepsiCo, Inc. “PepsiCo, Inc. 2016 annual report”. PepsiCo, Inc. Website, 2016. Web. 13th Feb. 2018. <http://www.pepsico.com/docs/album/annual-reports/pepsico-inc-2016-annual-report.pdf?sfvrsn=0>