Excess capacity adjustments

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Reference no: EM13924784

EXCESS CAPACITY ADJUSTMENTS

1. osato chemicals inc had sales of $1,790,000 last year on fixed assets of $395,000. given that osato's fixed assets were being used at only 92% of capacity, then the firms fixed asset turnover ratio was____?

2. how much sales could osato chemicals inc. have supported with its current level of fixed assets? A. $1,655,522 B. $1,751,087 C. $1,945,652 D. $2,042,935

3. When you consider that Osato's fixed assets were being underused, what should be the firms target fixed asset to sales ratio? A. 23.35% B. 20.30% C. 24.36% D. 21.32%

4. Suppose Osato is forecasting sales growth of 19% for this year. if existing and new fixed assets are used at 100% capacity, the firms expected fixed-assets turnover ratio for this year is A. 5.172x B. 5.911x C. 5.665x D. 4.926

Reference no: EM13924784

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