EXCESS CAPACITY Walter Industries has $5 billion in sales and $1 7 billion in fixed assets. Currently,
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EXCESS CAPACITY Walter Industries has $5 billion in sales and $1 7 billion in fixed assets.
Currently, the company’s fixed assets are operating at 90% of capacity.
a. What level of sales could Walter Industries have obtained if it had been operating at full capacity?
b. What is Walter’s Target fixed assets/Sales ratio?
c. 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?
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Related Book For 
Fundamentals Of Financial Management Concise Edition
ISBN: 9781285065137
8th Edition
Authors: Eugene F. Brigham, Joel F. Houston
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