Question

Molson-Coors Brewing Company reported the following operating information for a recent year (in millions):
Net sales ............... $3,254
Cost of goods sold ............ $1,812
Marketing, general, and admin. Expenses .. 1,013
$2,825
Income from operations ........ $ 429
Assume that Molson-Coors sold 30 million barrels of beer during the year, variable costs were 75% of the cost of goods sold and 40% 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 $40 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.



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  • CreatedFebruary 04, 2014
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