Currently, ABC Co. sells shirts for $20/ shirt.The marginal cost of production is currently is $9/ shirt with fixed costs set at $1,500/ year.The tax rate is 20%.

Assume that ABC Co. intends to expand operations and enters into a 10 year lease at $500/ month.It expects to increase the cost of its shirts to $18/ shirt and reduce marginal costs by $2/ shirt.It also expects to earn net income of $5/ shirt.What is the required dollar sales (round to the nearest dollar)?

Select one:

a.$22,500

b.$28,421

c.None of the above