Seashell Mfg., Inc. had $750 million of sales last year, and it had $435 million of...
Seashell Mfg., Inc. had $750 million of sales last year, and it had $435 million of fixed assets that were used at only 65% of capacity. What is the maximum sales growth rate Seashell could achieve before it had to increase its fixed assets?
Homework Answers
| Full capacity sales = Actual sales / Percentage of capacity at which fixed assets were operated | ||||||
| =$750/0.65 | ||||||
| =$1153.85 | ||||||
| Growth rate in sales = ($1153.85-750)/750 | ||||||
| =53.85% | ||||||
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