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Problem 1 7 . 1 2 ( Excess Capacity ) Earleton Manufacturing Company has $ 2 billion in sale and $ 8 6 5 ,
Problem Excess Capacity
Earleton Manufacturing Company has $ billion in sale and $ in fixed assets. Currently, the company's fixed assets are operating at of capacity.
a What level of sales could Earleton have obtained if it had been operating at full capacity? Write out your answers completely. For example, million should be entered as Round vour answer to the nearest dollar. $
b What is Earleton's target fixed assetssales ratio? Do not round intermediate calculations. Round your answer to two decimal places.
c If Earleton's sales increase how large of an increase in fixed assets will the company need to meet its target fixed assetssales ratio? Write out your answer completely. Do not round intermediate calculations. Round your answer to the nearest dollar. $
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