5. Excess capacity adjustments A) Osato Chemicals Inc. had sales of $1,550,000 last year on...
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Finance
5. Excess capacity adjustments
A) Osato Chemicals Inc. had sales of $1,550,000 last year on fixed assets of $345,000. Given that Osatos fixed assets were being used at only 94% of capacity, then the firms fixed asset turnover ratio was _________? (Note: Round your answer to two decimal places.)
B) How much sales could Osato Chemicals Inc. have supported with its current level of fixed assets? (Note: Round your answer to the nearest whole number.)
$1,813,830
$1,648,936
$1,731,383
$1,319,149
C) When you consider that Osatos fixed assets were being underused, what should be the firms target fixed assets to sales ratio? (Note: Round your answer to two decimal places.)
23.01%
20.92%
21.97%
16.74%
D) Suppose Osato is forecasting sales growth of 21% 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 _________ .(Note: Round your answer to two decimal places.)
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