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3. Excess capacity adjustments Western Gas & Electric Co. (WG&E) currently has $540,000 in total assets and sales of $1,550,000. Half of WG&E's total assets
3. Excess capacity adjustments Western Gas & Electric Co. (WG&E) currently has $540,000 in total assets and sales of $1,550,000. Half of WG&E's total assets come from net fixed assets, and the rest are current assets. The firm expects sales to grow by 19% in the next year. According to the AFN equation, the amount of additional assets required to support this level of sales is $ WG&E 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? $1,631,579 $1,876,316 $1,713,158 O $1,794,737 When you consider that WG&E's fixed assets were being underused, its target fixed assets to sales ratio should be %. When you consider that WG&E's fixed assets were being underused, how much fixed assets must WG&E raise to support its expected sales for next year? $40,520 O $35,235 $36,997 $38,759
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