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Edmonds Industries is forecasting the following income statement: Sales $11,000,000 Operating costs excluding depreciation & amortization 6,050,000 EBITDA $4,950,000 Depreciation and amortization 880,000 EBIT $4,070,000

Edmonds Industries is forecasting the following income statement:

Sales $11,000,000

Operating costs excluding depreciation & amortization 6,050,000

EBITDA $4,950,000 Depreciation and amortization 880,000

EBIT $4,070,000

Interest 1,100,000

EBT $2,970,000

Taxes (25%) 742,500

Net income $2,227,500

The CEO would like to see higher sales and a forecasted net income of $2,900,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 13%. 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 $2,900,000 in net income? Round your answer to the nearest dollar, if necessary.

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