View the step-by-step solution to:

Question

Q5. Bear Brewery, based in Langley, British Columbia, specializes in craft beer. The brewery produces two ales:

Amber and Dubbel. 

Bear Brewery aligns its ale prices with competitors. The brewery sells its Amber for $14.95 per case and its Dubbel for $15.65 per case. The per case variable costs for Amber include $3.50 in raw materials, $0.75 in packaging, $1.20 in manufacturing overhead and $0.55 in shipping. Dubbel's per case variable costs are $3.85 in raw materials, $0.75 in packaging, $1.95 in manufacturing overhead and $0.75 in shipping. Fixed costs include office lease of $25,000, office supplies of $4,500 and marketing expenses of $6,000. 

Make a spreadsheet that provides the income position of the brewery for the upcoming year. The brewery projects demand to be 10,000 cases for Amber, and 8,000 cases for Dubbel. Assuming a unit to unit sale, what is a more profitable beer for Bear Brewery? Determine the break-even for each beer, assuming that fixed expenses are allocated as follows: 45% for Amber and 55% for Dubbel. Provide a chart showing the break-even point for each beer. 

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Let our 24/7 Computer Science tutors help you get unstuck! Ask your first question.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes
A+ icon
Ask Expert Tutors