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The brewery has two units of sale: a retail sales unit - 16 oz pints - and a wholesale sales unit - 1,984 oz. kegs.
The brewery has two units of sale: a retail sales unit - 16 oz pints - and a wholesale sales unit - 1,984 oz. kegs. The pints will be sold for $6.25 and the kegs for $150. The variable cost per ounce of beer brewed is $0.046875/ounce. In addition, they estimate the brewery will incur the following fixed costs per month: Salaries & Wages Mortgage Insurance Utilities Marketing Expenses Misc. Accounts Payable S6000 S4500 S1500 S1800 S1400 $1500 Pandemic Brewing's brewing capacity is based on a 30-barrel brewing system. When operating at maximum capacity, assuming no beer is lost in the process, the founders believe they can brew approximately three batches per month. There are 3,968 fluid ounces in a barrel of beer. 1. Based on their monthly fixed expenses and the variable cost per unit, compute the number of pints they would need to sell in a month to breakeven (assuming they only sell pints). 2. Based on their monthly fixed expenses and the variable cost per unit, compute the number of kegs they would need to sell in a month to breakeven (assuming they only sell kegs)
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