Break-Even Sales Molson Coors Beverage Company (TAP) reported the following operating information for a recent year (in millions): Net sales $10,280 Cost of goods sold (6,226) Gross profit $4,054 Selling, general, and admin. expenses (2,555) Operating income $1,499** *Before special items Assume that Molson Coors sold 200 million barrels during the year, variable costs were 70% of the cost of goods sold and 35% of selling, 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 $25 million. a. Compute the break-even sales (barrels) for the current year. Round intermediate computations to the nearest cent and final answer up to the nearest whole barrel. barrels b. Compute the anticipated break-even sales (barrels) for the following year. Round intermediate computations to the nearest cent and final answer up to the nearest whole barrel. barrels
Break-Even Sales Molson Coors Beverage Company (TAP) reported the following operating information for a recent year (in millions): Net sales $10,280 Cost of goods sold (6,226) Gross profit $4,054 Selling, general, and admin. expenses (2,555) Operating income $1,499** *Before special items Assume that Molson Coors sold 200 million barrels during the year, variable costs were 70% of the cost of goods sold and 35% of selling, 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 $25 million. a. Compute the break-even sales (barrels) for the current year. Round intermediate computations to the nearest cent and final answer up to the nearest whole barrel. barrels b. Compute the anticipated break-even sales (barrels) for the following year. Round intermediate computations to the nearest cent and final answer up to the nearest whole barrel. barrels
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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am.111.
Transcribed Image Text:Break-Even Sales
Molson Coors Beverage Company (TAP) reported the following operating information for a recent year (in millions):
Net sales
$10,280
Cost of goods sold
(6,226)
Gross profit
$4,054
Selling, general, and admin. expenses
(2,555)
Operating income
$1,499**
*Before special items
Assume that Molson Coors sold 200 million barrels during the year, variable costs were 70% of the cost of goods sold and 35% of selling, 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 $25 million.
a. Compute the break-even sales (barrels) for the current year. Round intermediate computations to the nearest cent and final answer up to
the nearest whole barrel.
barrels
b. Compute the anticipated break-even sales (barrels) for the following year. Round intermediate computations to the nearest cent and final
answer up to the nearest whole barrel.
barrels
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