westcengagenow.com/ilrnytakeAssignment/takeAssignmentMain.do ent: Chapter 17 Fin
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westcengagenow.com/ilrnytakeAssignment/takeAssignmentMain.do ent: Chapter 17 Financial Planning and Forecasting Assignnent Score: 20 SaveExit Submit Assignment for Grad s Problem 17.05 Check My Work (e remainin eBook Problem 17-5 Excess capacity walter Industries has $5 billion in sales and $1.9 billion in fixed assets. Currently, the company's fixed assets are perating at 95% of aad a. What level of sales could Walter Industries have obtained if it had been operating at full capaity? write out your answer completely, For example, 25 billion should be entered as 25,000,000,000. Round your answer to the nearest cent. b. What is walter's target fixed assats/Sales ratio? Round your answer to two decimal places. c. If walter's sales increase 9%, how large of an increase in fixed assets the company needto bllion should be entered as 25,000,000,000. Round your answer to the nearest cent. Do not an increase in fixed assets will the company need to meet its Target fixed assets/Sales ratio? wite out your answer completely. For example, 25 round intermed ate calculations Check My Work (o rensaining) Ouestion 7 of 1 Problem 17.03Explanation / Answer
Walter Industries Details Amt $ Current Sales 5,000,000,000 Fixed Asset 1,900,000,000 Asset Capacity Utilization 95% a At 100% capacity utilization sales will be = $ 5,263,157,895 b Target Sales 5,263,157,895 Fixed Asset 1,900,000,000 Target Fixed asset/Sales ratio = 0.361 c If sales grows by 9% Current Sales 5,000,000,000 Revised Sales = 5,450,000,000 Target Fixed Asset/Sales ratio 0.361 Target Fixed Asset Requirement 1,967,450,000 Current Fixed assets 1,900,000,000 Increase in Fixed Assets Required = $ 67,450,000.00
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