Compute the break-even number of barrels for current year

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Reference no: EM132806909

Question - Break-Even Sales - Anheuser-Busch In Bev SA/NV (BUD) reported the following operating information for a recent year:

Sales $3,248,000

Cost of goods sold $812,000

Selling, general, and administrative expenses 406,000 1,218,000

Operating income $2,030,000 **Before special items

In addition, assume that Anheuser-Busch InBev sold 29,000 barrels of beer during the year. Assume that variable costs were 75% of the cost of goods sold and 50% of selling, general, and administrative 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 $12,200.

Required -

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.

Reference no: EM132806909

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