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SIZIF [17.4K]
4 years ago
15

Molson-Coors Brewing Company (TAP) reported the following operating information for a recent year (in millions):

Business
1 answer:
Dahasolnce [82]4 years ago
7 0

Answer:

1)Break Even Sales Volume in Units=105.789067 million barrels

2))Break Even Sales Volume in Units=114.0512569 million barrels

Explanation:

Break Even Sales Volume in Units= Fixed Costs/ Contribution Margin per unit

<em>Given</em>

<em>Molson-Coors</em>

<em> All figures in millions</em>

Sales $3,568

Cost of goods sold (2,164)

Gross profit $1,404

Marketing, general, and admin. expenses (1,052)

Operating income $352

<em>Molson-Coors</em>

<em>         All figures in millions</em>

Sales $3,568

Variable Cost of goods sold (2,164)*70%=  (15,14.8)

Variable Marketing, general, and admin. expenses (1,052) *40%=  (600.8)

Contribution Margin $1,452.4

Fixed Cost of Goods Sold 649.2

Marketing, general, and admin. expenses (1,052) *60%= $ 631.2

Operating income $172

Break Even Sales Volume in Units= Fixed Costs/ Contribution Margin per unit

<em><u>When Fixed Costs are not increased in the current year.</u></em>

Break Even Sales Volume in Units= 649.2+631.2/12.1033 (millions)

1)Break Even Sales Volume in Units=105.789067 millions barrels

<em><u>When Fixed Costs are increased in the following year.</u></em>

Break Even Sales Volume in Units= 649.2+631.2+ 100/12.1033 (milions)

2))Break Even Sales Volume in Units=114.0512569 millions barrels

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