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A manufacturing firm is operating at 94 percent of its fixed asset capacity and has current sales of S611,000. How much can the firm grow before any new fixed assets are needed? Oa O b. Ос 5.0% 5.8% 6,0% 6.4% 6.8% d.
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Answer #1

Answer : "d. 6.4%"

=> Firm grow before any new fixed assets are needed from present = Fixed assets capacity remaining / Present Capacity

= 6% * 100 / 94% = 6.38% or 6.4%

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