Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Here is the 2019 Income Statement for Karnes automotive (numbers in millions) (next page...):Sales$16.5COGS 7.1Costs 3.2Depreciation and Amortization 2.9EBIT$ 3.3Interest 0.95EBT$ 2.35Taxes (30%) 0.71Net Income$
Here is the 2019 Income Statement for Karnes automotive (numbers in millions) (next page...):Sales$16.5COGS 7.1Costs 3.2Depreciation and Amortization 2.9EBIT$ 3.3Interest 0.95EBT$ 2.35Taxes (30%) 0.71Net Income$ 1.65The CEO wants the company to earn a net income of $2.65 million in 2020. Cost of goods sold is expected to be 75% of sales; depreciation and other costs are not expected to change; interest expense is expected to increase to $1.050 million; the tax rate will be 30%. Calculate the sales needed to produce net income of $2.65 million.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started