Blasco Industries is currently at full-capacity sales.Which one of the following is limiting sales to this level?
A)net working capital
B)long-term debt
C)inventory
D)fixed assets
E)debt-equity ratio

Question

Quizplus · Accepted Answer

Fixed assets limit sales at full capacity because they represent the physical assets (such as machinery, buildings, and equipment) that a company uses to produce its goods or services. When a company is operating at full capacity, it means that its fixed assets are being utilized to their maximum potential and cannot produce more without additional investment in these assets.

Blasco Industries Is Currently at Full-Capacity Sales