$3.$ Excess capacity adjustments

Newtown Propane currently has $$490,000$ in total assets and sales of $$1,820,000.$ Half of Newtown$$s total assets come from net fixed assets, and the rest are current assets. The firm expects sales to grow by $20\%$ in the next year. According to the AFN equation, the amount of additional assets required to support this level of sales is $

$.$

Newtown was using its fixed assets at only $95\%$ of capacity last year. How much sales could the firm have supported last year with its current level of fixed assets?

$$1,915,789$

$$1,724,210$

$$1,628,421$

$$2,298,947$

When you consider that Newtown$$s fixed assets were being underused, its target fixed assets to sales ratio should be

$\%.$

When you consider that Newtown$$s fixed assets were being underused, how much fixed assets must Newtown raise to support its expected sales for next year?

$$29,155$

$$41,160$

$$34,300$

$$30,870$