Ed's Market Is Operating at Full Capacity with a Sales

Multiple Choice

Ed's Market is operating at full capacity with a sales level of $547,200 and fixed assets of $471,000. The profit margin is 5.4 percent. What is the required addition to fixed assets if sales are to increase by 4 percent?

A) $10,709
B) $14,680
C) $22,400
D) $16,760
E) $18,840