Molson-Coors Brewing Company reported the following operating information for a recent year (in millions):
Net sales ................. $3,516
Cost of goods sold ............. $2,049
Marketing, general, and admin. expenses ..... 1,019
Income from operations ........... $ 448*
“Before special items
Assume that Molson-Coors sold 35 million barrels of beer during the year, variable costs were 80% of the cost of goods sold and 45% of marketing, general, and administrative expenses, and that the remaining costs are fixed. For the following year, assume that Molson-Coors 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 $75 million.
Rounding to the nearest cent:
a. Compute the break-even sales (barrels) for the current year.
b. Compute the anticipated break-even sales (barrels) for the following year.

  • CreatedMarch 11, 2014
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