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problem: Income Statement Hermann Industries is forecasting following income statement;


$8, 000, 0000

Operating costs excluding Depreciation and amortization






Depreciation and amortization








Taxes (40%)


Net Income


The CEO would like to see a higher sales & a predicted net income of $2,500,000

Suppose that operating costs [excluding depreciation and amortization] are 55% of sales and depreciation and amortization and interest expenses will increase by 10%. The tax rate, which is 40%, will remain the same. What level of sales would create $2,500,000 in net income?


Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M920658

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