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Edmonds Industries is forecasting the following income statement: Sales $7,000,000 Operating costs excluding depreciation & amortization...

Edmonds Industries is forecasting the following income statement:

Sales $7,000,000
Operating costs excluding depreciation & amortization 3,850,000
EBITDA $3,150,000
Depreciation and amortization 350,000
EBIT $2,800,000
Interest 700,000
EBT $2,100,000
Taxes (25%) 525,000
Net income $1,575,000

The CEO would like to see higher sales and a forecasted net income of $1,920,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 14%. The tax rate, which is 25%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate $1,920,000 in net income? Round your answer to the nearest dollar, if necessary.

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ekkarill92 answered 2 years ago
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