Income Statement Hermann Industries is forecasting the following incomestatement: Sales
Income Statement
Hermann Industries is forecasting the following incomestatement:
Sales
|
$8,000,000
|
Operating costs excludingdepreciation & amortization
|
4,400,000
|
EBITDA
|
$3,600,000
|
Depreciation and amortization
|
800,000
|
EBIT
|
$2,800,000
|
Interest
|
480,000
|
EBT
|
$2,320,000
|
Taxes (40%)
|
928,000
|
Net income
|
$1,392,000
|
The CEO would like to see higher sales and a forecasted netincome of $2,714,400. Assume that operating costs (excludingdepreciation and amortization) are 55% of sales and thatdepreciation and amortization and interest expenses will increaseby 13%. The tax rate, which is 40%, will remain the same. Whatlevel of sales would generate $2,714,400 in net income? Ifnecessary, round your answer to the nearest dollar at the end ofthe calculations.
Abhinav
04-Dec-2019