Rosita's Bakery has sales of $236,000 and $168,500 of total assets. The firm is operating at 82% of capacity. What is the capital intensity ratio at full capacity?

Question

Quizplus · Accepted Answer

The capital intensity ratio is calculated as total assets divided by sales. At full capacity, sales would be $236,000 / 0.82 = $287,804.88. The capital intensity ratio at full capacity is $168,500 / $287,804.88 = 0.59.

Rosita's Bakery Has Sales of $236,000 and $168,500 of Total