Break-Even SalesAnheuser-Busch InBev SA/NV (BUD) reported the following operating information for a recent year:Sales$5,824,000Cost of goods sold$1,456,000Selling, general, and administrative expenses520,000Operating income1,976,000$3,848,000**Before special itemsIn addition, assume that Anheuser-Busch InBev sold 52,000 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 perbarrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $18,700.a. Compute the break-even number of barrels for the current year. Round to the nearest whole barrel.X barrelsb. Compute the anticipated break-even number of barrels for the following year. Round to the nearest whole barrel.barrels

First we will determine the current fixed cost Fixed cost component in Cost of goods sold is = 1 -…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Show Me How Question Content Area Break-Even Sales Under Present and Proposed Conditions Portmann Company, operating at full capacity, sold 1,000,000 units at a price of $188 per unit during the current year. Its income statement is as follows: Sales $188,000,000 Cost of goods sold (99,000,000) Gross profit $89,000,000 Expenses: Selling expenses $15,000,000 Administrative expenses 14,900,000 Total expenses (29,900,000) Operating income $59,100,000 The division of costs between variable and fixed is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% Administrative expenses 50% 50% Management is considering a plant expansion program for the following year that will permit an increase of $11,280,000 in yearly sales. The expansion will increase fixed costs by $3,500,000 but will not affect the relationship between sales and variable costs.Determine the maximum operating income…
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Anheuser-Busch InBev Companies, Inc., reported the following operating information for a recent year: Sales $11,136,000 Cost of goods sold $2,784,000 Selling, general and administration 1,044,000 $3,828,000 Income from operations $ 7,308,000* *Before special items In addition, assume that Anheuser-Busch InBev sold 58,000 barrels of beer during the year. Assume that variable costs were 75% of the cost of goods sold and 50% of selling, general, and 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 $36,500. a. Compute the break-even number of barrels for the current year. Round to the nearest whole barrel.fill in the blank 1 barrels b. Compute the anticipated break-even number of barrels for the following year. Round to…
The Boston Beer Company Inc. (SAM) produces Samuel Adams beer and other alcoholic beverages. Boston Beer reported the following operating information for a recent year (in thousands): Line Item Description Amount Amount Sales $9,680,000 Cost of goods sold $2,420,000 Selling, general, and administrative expenses 550,000 (2,970,000) Operating income $6,710,000* *Before special items In addition, assume that Boston Beer sold 55,000 thousand 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 Boston Beer 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 $26.40 million. a. Compute the break-even number of barrels for the current year. Round to the nearest…
Sales $ 1,066,000 Selling price per pair of skis $ 410 Variable selling expense per pair of skis $ 47 Variable administrative expense per pair of skis $ 18 Total fixed selling expense $ 135,000 Total fixed administrative expense $ 115,000 Beginning merchandise inventory $ 65,000 Ending merchandise inventory $ 120,000 Merchandise purchases $ 310,000 Required: 1. Prepare a traditional income statement for the quarter ended March 31. 2. Prepare a contribution format income statement for the quarter ended March 31. 3. What was the contribution margin per unit?
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Break-Even Sales Anheuser-Busch InBev Companies, Inc., reported the following operating information for a recent year: $5,952,000 $1,488,000 372,000 $1,860,000 $ 4,092,000* Sales Cost of goods sold Selling, general and administration Income from operations *Before special items In addition, assume that Anheuser-Busch InBev sold 31,000 barrels of beer during the year. Assume that variable costs were 75% of the cost of goods sold and 50% of selling, general, and 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 $16,700. a. Compute the break-even number of barrels for the current year. Round to the nearest whole barrel. barrels b. Compute the anticipated break-even number of barrels for the following year. Round to the nearest whole…
Sisyphus Inc. records total sales of $657,500 in the current period, with a cost of goods sold of $389,000 . Sisyphus expects 4% of sales to be returned. How much in net sales will Sisyphus recognize for the current period? Group of answer choices $373,400 $268,500 $631,200 $657,500 $257,760 The Sisyphus Inc’s (SSY) Company’s annual statement of cash flows reported the following (in millions): Net cash from financing activities $63,864 Net cash from investing activities -62,512 Cash at the beginning of the year 13,152 Cash at the end of the year 18,948 What did SSY report for “Net cash from operating activities” during the year? Group of answer choices $71,220 million cash inflow None of the above $4,444 million cash outflow $4,444 million cash inflow $71,220 million cash outflow
The following is the year ended data for Tiger Company: Sales Revenue $58,000 Cost of Goods Manufactured 21,000 Beginning Finished Goods Inventory 1,100 Ending Finished Goods Inventory 2,200 Selling Expenses 15,000 Administrative Expenses 3,900 What is the gross profit? A. $22,100 B. $38,100 C. $19,200 D.
s
Differential Analysis for a Discontinued Product A condensed income statement by product line for Warrick Beverage Inc. indicated the following for Mango Cola for the past year: Sales $15,000,000 Cost of goods sold (10,800,000) Gross profit $4,200,000 Operating expenses (8,000,000) >) Operating loss $(3,800,000) It is estimated that 30% of the cost of goods sold represents fixed factory overhead costs and that 25% of the operating expenses are fixed. Because Mango Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued. a. Prepare a differential analysis dated February 29 to determine whether Mango Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Differential Analysis Continue (Alt. 1) or Discontinue (Alt. 2) Mango Cola February 29 Continue Discontinue Differential Mango Cola Effects Mango Cola (Alternative 1) (Alternative…

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