What is the full capacity sales

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The B Company, expertly run by Dr. B, needs to expand its production. Current sales are $25,500 and that is expected to grow by 15% next year and subsequent years. "NI" for the firm is $3,000. Although it plans to expand production, Dr. B does not expect the "PM" to change. He also does not expect the "d" to change, which is 0.1. Current Assets are $500 and the firm pays it suppliers the moment it gets deliveries, because Dr. B has negotiated that he gets a discount if he pays Cash-on-Delivery. However, the firm has a short-term loan of $100. Its current machines operate at 91% of capacity. The supplier of machines has the X-1500 for sale, which can generate $6,000 worth of sales in a year and costs $18,500. They last 5 years and have a Terminal Value of $300. The WACC is 7.8%

What is the Full Capacity Sales?

Reference no: EM132719000

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