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 $ 17.400 7.900 $ 9.500 3.600 $ 5.900 2.700 $ 3.200 0.785 $ 2.415 0.507 $ 1.908 The CEO of Tom and Sue's wants the company to earn a net income of $2.650 million. Cost of goods sold is expected to be 50 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.251 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $2.650 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Answer is complete but not entirely correct. Net sales $ 250.188 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 $ 17.400 7.900 $ 9.500 3.600 $ 5.900 2.700 $ 3.200 0.785 $ 2.415 0.507 $ 1.908 The CEO of Tom and Sue's wants the company to earn a net income of $2.650 million. Cost of goods sold is expected to be 50 percent of net sales, depreciation and other operating expenses are not expected to change, interest expense is expected to increase to $1.251 million, and the firm's tax rate will be 21 percent. Calculate the net sales needed to produce net income of $2.650 million. Note: Enter your answer in millions of dollars rounded to 3 decimal places. (i.e., Enter 5,500,000 as 5.500.) Answer is complete but not entirely correct. Net sales $ 250.188 million

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Description: Problem 2-33 Income Statement (LG2-1)Listed below is the income statement for Tom and Sue Travels, Incorporated.TOM AND SUE TRAVELS, INCORPORATEDIncome Statement for Year End(in millions of dollars)Net salesLess: Cost of goods soldGross profitsLess:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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