Break - Even Sales Cold One Beverage Company reported the following operating information for a recent year (in millions): Line Item Description Amount Net sales $3,600 Cost of goods sold (900) Gross profit $2,700 Selling, general, and admin. expenses (350) Operating income $2,350 Assume that Cold One sold 25 million barrels during the year, variable costs were 70% of the cost of goods sold and 50% of selling, general, and administrative expenses, and that the remaining costs are fixed. For the following year, assume that Cold One 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 $13.35 million. a. Compute the break-even sales (barrels) for the current year. Round intermediate computations to the nearest cent and final answer up the nearest whole barrel fill in the blank 1 of 1 million 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 fill in the blank 1 of 1 million barrels

Break - Even Sales Cold One Beverage Company reported the following operating information for a recent year (in millions): Line Item Description Amount Net sales $3,600 Cost of goods sold (900) Gross profit $2,700 Selling, general, and admin. expenses (350) Operating income $2,350 Assume that Cold One sold 25 million barrels during the year, variable costs were 70% of the cost of goods sold and 50% of selling, general, and administrative expenses, and that the remaining costs are fixed. For the following year, assume that Cold One 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 $13.35 million. a. Compute the break-even sales (barrels) for the current year. Round intermediate computations to the nearest cent and final answer up the nearest whole barrel fill in the blank 1 of 1 million 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 fill in the blank 1 of 1 million barrels

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter5: Inventories And Cost Of Goods Sold

Section: Chapter Questions

Problem 5.23MCE

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