In millons: Sales $4,800 COGS $1,200 Gross Profit $3,600 Marketing, general, & admin exp $480 Income from operations $3,120 Assume that 30 million barrels were sold. Variable costs= 75% x 1200 COGS = $900 plus 50% x 480 exp = $240 for a total variable costs = $1140 The remaining costs are fixed. 1200+480-1140 = $540 a) Compute the break even sales (in barrels) for the current year. I tried 76.25% for contribution margin to get the break even sales of $708196.72 and the answer is not correct, therefore, I am not understanding the calculations.. Assume the following year everything remains constant except that th new distribution and general office facilities increase in fixed costs by $16.2 millon. b) compute the anticipated break even sales (in barrels) for the following year:
In millons:
Sales $4,800
COGS $1,200
Gross Profit $3,600
Marketing, general, & admin exp $480
Income from operations $3,120
Assume that 30 million barrels were sold.
Variable costs= 75% x 1200 COGS = $900 plus 50% x 480 exp = $240 for a total variable costs = $1140
The remaining costs are fixed. 1200+480-1140 = $540
a) Compute the break even sales (in barrels) for the current year.
I tried 76.25% for contribution margin to get the break even sales of $708196.72 and the answer is not correct, therefore, I am not understanding the calculations..
Assume the following year everything remains constant except that th new distribution and general office facilities increase in fixed costs by $16.2 millon.
b) compute the anticipated break even sales (in barrels) for the following year:
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