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Listed below is the 2018 income statement for Tom and Sue Travels, Inc. SUE TRAVELS ncome Statement for Year Ending December 31, 2018 Net sales Less: Cost of goods sold Gross profits Less: Other operating expenses Earnings before interest, taxes, depreciation, and $18.200 8.300 $ 9.900 3.880 amortization (EBITDA) Less: Depreciation Earnings before interest and taxes (EBIT) Less: Interest Earnings before taxes (EBT) Less: Taxes Net income 3.180 3.009 0.885 s 2.195 0.985 s 1.290 to earn a net income of $3 010 million in 2019. Cost of goods sold is expected to percent of net sales, depreciation and other operating expense to $0.905 million, and the firms tox rate will be 30 percent Colculate the net sales needed decimal places) s are not Calculate the net sales needed to produce net Income of $3,010 milin (Enter your enswer in millins of dollars round 1 sales million
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Answer #1

Desired net income=$3.010

Tax @30%=$3.010×30÷70

=$1.29

Given interest=$0.905

Therefore EBIT=$3.010+$1.29+$0.905

=$5.205

Gross profit=$5.205+depreciation+operating expenses

=$5.205+3.100+3.800

=12.105

As cost of goods sold is 50 percent...

Net sales=12.105÷50 %

=$24.21millions...

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