EXCESS CAPACITY Edney Manufacturing Company has $2 billion in sales and $0 6 billion in fixed assets.

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EXCESS CAPACITY Edney Manufacturing Company has $2 billion in sales and $0 6 billion in fixed assets. Currently, the company’s fixed assets are operating at 80% of capacity.

a. What level of sales could Edney have obtained if it had been operating at full capacity?

b. What is Edney’s Target fixed assets/Sales ratio?

c. If Edney’s sales increase 30%, how large of an increase in fixed assets will the company need to meet its Target fixed assets/Sales ratio?

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Fundamentals Of Financial Management Concise Edition

ISBN: 9781285065137

8th Edition

Authors: Eugene F. Brigham, Joel F. Houston

Question Posted: Jul 20, 2024 05:01 AM

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EXCESS CAPACITY Edney Manufacturing Company has $2 billion in sales and $0 6 billion in fixed assets.

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Fundamentals Of Financial Management Concise Edition

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