Answer:
additional sales without adding the Fixed assets are $228.85 million
so correct option is d) $228.85
Explanation:
given data
sales = $425,000,000
fixed assets = $270,000,000
capacity = 65%
to find out
how much could ABC Media's sales increase before it is required to increase its fixed assets
solution
we get here Sales at full capacity that is express as
Sales at full capacity = Actual sales ÷ capacity % ..................1
put here value
Sales at full capacity =
Sales at full capacity = $653846153.8
so sales without adding fixed assets will be
sales without adding fixed assets = Full capacity sales - Actual sales ............2
put here value
sales without adding fixed assets = $653846153.8 - $425,000,000
sales without adding fixed assets = $228846153.8
so that additional sales without adding the Fixed assets are $228.85 million
so correct option is d) $228.85
