Reference no: EM132747938

Question: Break-Even SalesBeerBev, Inc., reported the following operating information for a recent year (in millions):

Sales $6,912

Cost of goods sold $1,728

Gross profit $5,184

Marketing, general, and admin. expenses 972

Income from operations $ 4,212

Assume that BeerBev sold 54 million barrels of beer during the year, that variable costs were 75% of the cost of goods sold and 50% of marketing, general and administration expenses, and that the remaining costs are fixed. For the following year, assume that BeerBev 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 $27.54 million.

a. Compute the break-even sales (in barrels) for the current year. Round your answer to two decimal places. Enter your answers in millions.

b. Compute the anticipated break-even sales (in barrels) for the following year. Round your answer to two decimal places. Enter your answers in millions.