Break-Even Sales Anheuser-Busch InBev SA/NV (BUD) reported the following operating information for a recent year: Sales   $4,640,000 Cost of goods sold $1,160,000   Selling, general, and administrative expenses 522,000 1,682,000 Operating income   $2,958,000* *Before special items     In addition, assume that Anheuser-Busch InBev sold 29,000 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 per barrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $16,500. 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 barrel. barrels

Question

Break-Even Sales

Anheuser-Busch InBev SA/NV (BUD) reported the following operating information for a recent year:

Sales   $4,640,000
Cost of goods sold $1,160,000  
Selling, general, and administrative expenses 522,000 1,682,000
Operating income   $2,958,000*
*Before special items    

In addition, assume that Anheuser-Busch InBev sold 29,000 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 per barrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $16,500.

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 barrel.
barrels

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