4. Chapter 3 Problem 15 (with different numbers). (HINT: There are different ways to do this problem. One way is to start at the bottom and work your way back up.) Edmonds Industries is forecasting the following income statement: Sales Operating costs excl. Dep and Amort. EBITDA Depreciation and Amortization EBIT Interest EBT Taxes (30%) Net Income $13,250,000 7,287,500 $ 5,962,500 1,250,000 $ 4,712,500 750,000 $ 3,962,500 1,188,750 $ 2,773,750 The CEO would like to see higher sales and a forecasted net income of $3,250,000. Assume that operating costs (excluding depreciation and amortization) are 45% of sales and that depreciation and amortization and interest expenses will increase by 10%. The tax rate, which is 30%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate $3,250,000 in net income