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NEW QUESTION: 1
A company has excess capacity in production-related fixed assets. If in a given year these fixed assets were being used to only 80 percent of capacity and the sales level in that year was US $2,000,000, the full capacity sales level is:
A. U S $10,000,000
B. U S $2,500,000
C. U S $1,600,000
D. U S $2,000,000
Full capacity sales can be calculated as follows: Actual sales - percent of capacity an which fixed assets were operated = US $2,000,000 - 80 = US $2,500,000.
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