Margin of Safety

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

Sales		$3,568
Cost of goods sold		(2,164)
Gross profit		$1,404
Marketing, general, and admin. expenses		(1,052)
Operating income		$ 352*

*Before special items

Assume that Molson-Coors sold 120 million barrels of beer during the year, variable costs were 70% of the cost of goods sold and 40% of marketing, 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 $100 million. Assume that break-even sales are $2,798 million.

1. Margin of safety expressed as dollar sales.. Enter the answer in millions. ______________$ million

2. Margin of safety expressed as a percentage. Enter the answer as percent rounded to one decimal place. ______________%