My guess would be that the rule is "only sell Pepsi products" and they are asking for donations to resell at the school carnival.
If you don't want the Pepsi, I would neither donate nor buy them. Bring a bottle of water to the school carnival, write a cheque to the PTA if you want to donate at all, and go one. If your issue is that they're serving soda then bring that up to the school, but I don't see how it would be different if they were buying and selling coke products.
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