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Sales $7,000,000 Operating costs excluding depreciation & amortization 3,850,000 EBITDA $3,150,000 Depreciation and amortization 980,000 EBIT $2,170,000 Interest 700,000 EBT $1,470,000 Taxes (25%) 367,500 Net

Sales $7,000,000
Operating costs excluding depreciation & amortization 3,850,000
EBITDA $3,150,000
Depreciation and amortization 980,000
EBIT $2,170,000
Interest 700,000
EBT $1,470,000
Taxes (25%) 367,500
Net income $1,102,500

The CEO would like to see higher sales and a forecasted net income of $1,400,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 14%. 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 $1,400,000 in net income? Round your answer to the nearest dollar, if necessary.

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