PR.19-06B.ALGO EX.19-12.ALGO BE.19-06.ALGO PR.19-04A.ALGO EX.19-09.ALGO Hide or

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PR.19-06B.ALGO

EX.19-12.ALGO

BE.19-06.ALGO

PR.19-04A.ALGO

EX.19-09.ALGO

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Break-Even Sales

Anheuser-Busch InBev Companies, Inc., reported the following operating information for a recent year:

In addition, assume that Anheuser-Busch InBev sold 26,000 barrels of beer during the year. Assume that variable costs were 75% of the cost of goods sold and 50% of selling, general, and administration expenses. Assume that the remaining costs are fixed. For the following year, assume that Anheuser-Busch InBev expects pricing, variable costs per barrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $14,800.

a. Compute the break-even number of barrels for the current year. Round to the nearest whole barrel.
barrels

b. Compute the anticipated break-even number of barrels for the following year. Round to the nearest whole barrel.
barrels

Sales $4,992,000 Cost of goods sold $1,248,000 Selling, general and administration 364,000 $1,612,000 Income from operations $ 3,380,000* *Before special items

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Amount Per Unit Sales                   4,992,000.00                   192.00 Less Variable Expenses Variable cost of goods sold                       936,000.00                      36.00 Variable Selling, general and administration                       182,000.00                        7.00 Total Variable costs                   1,118,000.00                      43.00 Contribution Margin                   3,874,000.00                   149.00 Fixed costs : Fixed cost of goods sold                       312,000.00 Fixed Selling, general and administration                       182,000.00 Total Fixed costs                       494,000.00 Net operating income                   3,380,000.00 Break even = 494,000/149                                 3,315 Paticulars Coming Year Per Unit Sales                   4,992,000.00                   192.00 Less Variable Expenses Variable cost of goods sold                       936,000.00                      36.00 Variable Selling, general and administration                       182,000.00                        7.00 Total Variable costs                   1,118,000.00                      43.00 Contribution Margin                   3,874,000.00                   149.00 Fixed costs : Fixed cost of goods sold                       312,000.00 Fixed Selling, general and administration = 182000 + 14800                       196,800.00 Total Fixed costs                       508,800.00 Net operating income                   3,365,200.00 Break even = 508,800/149                                 3,415

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