Answer Happy

The Kochman Company reported the following income statement in 2021: Sales $3,840,000 Operating costs excluding decreciation & amortization (70%) 2.688,000 EBITDA $1.152.000 Depreciation and amortization 241,836 EBIT $ 910,164 Interest 139.500 EBT 770.664 Taxes (25%) 192.666 Net income 577.998 The CEO is very disappointed With these numbers and would like to see higher sales and a net income of $1,080,000 in 2022. Assume that in 2022, operating costs (excluding depreciation and amortization) will remain 70% of sales. Also that the depreciation and amortization expense and the interest expense will remain constant at 2021 levels. (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 in 2022 would generate $1,080,000 in net income? 1. $4.249.784 2. $4.491.620 3. $5,160,452 4. $5,829,284 5. $6,071,120