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Problem 2-33 Income Statement (LG2-1) Listed below is the income statement for Tom and Sue Travels, Incorporated. TOM AND SUE TRAVELS, INCORPORATED Income Statement for Year End (in millions of dollars) Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) Less: Taxes Net income The CEO of Tom and Sue's wants the company to earn a net income of $3.100 million. Cost of goods sold is expected to be 60 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.296 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $3.100 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Net sales $19.200 8.800 $10.400 4.050 $ 6.350 3.600 $ 2.750 0.830 $ 1.920 0.403 $ 1.517 million

Problem 2-33 Income Statement (LG2-1) Listed below is the income statement for Tom and Sue Travels, Incorporated. TOM AND SUE TRAVELS, INCORPORATED Income Statement for Year End (in millions of dollars) Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) Less: Taxes Net income The CEO of Tom and Sue's wants the company to earn a net income of $3.100 million. Cost of goods sold is expected to be 60 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.296 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $3.100 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Net sales $19.200 8.800 $10.400 4.050 $ 6.350 3.600 $ 2.750 0.830 $ 1.920 0.403 $ 1.517 million

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Problem 2-33 Income Statement (LG2-1) Listed below is the income statement for Tom and Sue Travels, Incorporated. TOM AND SUE TRAVELS, INCORPORATED Income Statement for Year End (in millions of dollars) Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) Less: Taxes: Net income The CEO of Tom and Sue's wants the company to earn a net income of $3.100 million. Cost of goods sold is expected to be 60 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.296 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $3.100 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Net sales $19.200 8.800 $10.400 4.050 $6.350 3.600 $ 2.750 0.830 $ 1.920 0.403 $1.517 million
Transcribed Image Text:Problem 2-33 Income Statement (LG2-1) Listed below is the income statement for Tom and Sue Travels, Incorporated. TOM AND SUE TRAVELS, INCORPORATED Income Statement for Year End (in millions of dollars) Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) Less: Taxes: Net income The CEO of Tom and Sue's wants the company to earn a net income of $3.100 million. Cost of goods sold is expected to be 60 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.296 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $3.100 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Net sales $19.200 8.800 $10.400 4.050 $6.350 3.600 $ 2.750 0.830 $ 1.920 0.403 $1.517 million
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