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Sales $11,000,000 Operating costs excluding depreciation & amortization 6,050,000 EBITDA $4,950,000 Depreciation and amortization 550,000 EBIT $4,400,000 Interest 1,100,000 EBT $3,300,000 Taxes (40%) 1,320,000 Net
Sales | $11,000,000 |
Operating costs excluding depreciation & amortization | 6,050,000 |
EBITDA | $4,950,000 |
Depreciation and amortization | 550,000 |
EBIT | $4,400,000 |
Interest | 1,100,000 |
EBT | $3,300,000 |
Taxes (40%) | 1,320,000 |
Net income | $1,980,000 |
The CEO would like to see higher sales and a forecasted net income of $3,069,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 8%. The tax rate, which is 40%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate $3,069,000 in net income? Round your answer to the nearest dollar, if necessary.
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