Break-even sales
anheuser-busch inbev companies, inc., reported the following operating information for a recent year (in millions of dollars):
net sales $ 47,063
cost of goods sold $ 18,756
selling, general and administration 12,999
$ 31,755
income from operations $ 15,308*
*before special items in addition, assume that anheuser-busch inbev sold 400 million 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 $300 million. a. compute the break-even number of barrels for the current year. (note: for the selling price per barrel and variable costs per barrel, round to the nearest cent. round to one decimal place in millions of barrels.) b. compute the anticipated break-even number of barrels for the following year.
million barrels