Excess capacity Walter Industries has $8 billion in sales and $1.3 billion in fi

Question

Excess capacity

Walter Industries has $8 billion in sales and $1.3 billion in fixed assets. Currently, the company's fixed assets are operating at 95% of capacity.

What level of sales could Walter Industries have obtained if it had been operating at full capacity? Write out your answer completely. For example, 25 billion should be entered as 25,000,000,000. Round your answer to the nearest cent.
$   

THIS ANSWER IS 8421052631.6

What is Walter's target fixed assets/Sales ratio? Round your answer to two decimal places.
%

THE ANSWER IS 15.44%

If Walter's sales increase 12%, how large of an increase in fixed assets will the company need to meet its Target fixed assets/Sales ratio? Write out your answer completely. For example, 25 billion should be entered as 25,000,000,000. Round your answer to the nearest cent. Do not round intermediate calculations.
$

   NEED THIS ANSWER IN BOLD!! ASAP!!

Explanation / Answer

A Sales $8,000,000,000 B Fixed Asset $1,300,000,000 C Capacity 95% D Sale at 100% Capacity (A / C) $8,421,052,631.58 E Fixed Asset to Sales Ratio (B / D) 15.44% F Sales at 12% increase (A * 1.12) $8,960,000,000.00 G Fixed Asset Requird (E * F) Fixed Asset ot Sales Ratio * Target Sales $1,383,200,000.00

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