Reference no: EM132430915

Question - Anheuser-Busch InBev Companies, Inc., reported the following operating information for a recent year (in millions of dollars):

Net sales: $39,758

Cost of goods sold: $16,447

Selling, general and administration: $10,578

$27,025

Income from operations: $12,733*

Before special items

In addition, assume that Anheuser-Busch InBev sold 320 million barrels of beer during the year. Assume that variable costs were 70% of the cost of goods sold and 40% 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 $400 million.

When computing the cost per unit amounts for the break-even formula, round to two decimal places. If required, round your final answer to the nearest whole barrel.

a. Compute the break-even number of barrels for the current year.

b. Compute the anticipated break-even number of barrels for the following year.