Answer:
The sales amount is $2,500,000
Explanation:
To achieve a net income of $450,000 this year, the company needs to total its net income with variable and fixed costs.
To clarify, we apply the net income formula:
net income=sales-variable costs-fixed costs
By reworking the formula, sales can be calculated as:
sales=net income+variable costs+fixed costs
variable costs equal to 70% of sales,, rendering sales to be 0.7 times sales
sales=$450,000+$300,000+0.7 sales
This leads to sales - 0.7 sales = $750,000
Thus, 0.3 sales equals $750,000
As a result, sales equals $750,000/0.3 which is $2,500,000
