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Last year Jain Technologies had $250 million of sales and $100 million of fixed assets, therefore its FA/Sales ratio was 40%. Though, its fixed assets were used at just 75% of capacity. Now the company is developing its financial forecast for the coming year. As part of that process, the company wants to set its target Fixed Assets or Sales ratio at the level it would have had had it been operating at full capacity. What target FA/Sales ratio must the company set?

a. 28.5%

b. 30.0%

c. 31.5%

d. 33.1%

e. 34.7%

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M915792

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