Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The brewery has two units of sale: a retail sales unit - 16 oz pints - and a wholesale sales unit - 1,984 oz. kegs.

image text in transcribed

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)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Beating The Finacial Futures Market 2023 Deluxe Edition Almanac

Authors: Art Collins

1st Edition

979-8375310534

More Books

Students also viewed these Accounting questions

Question

What are warning limits, and what purpose do they serve?

Answered: 1 week ago