Hebner Housing Corp. has forecast the following data for the upcoming year. Sales of $1,000,000 and operating expenses including depreciation average 60% of sales. The firm taxed at 40% has $1,000,000 in debentures at 8% and a $200,000, 5 year note at 10%. The CEO is unhappy with the forecast and wants the firm to achieve a net income of $240,000. Assuming interest expense is unchanged, what level of sales will the firm need to meet the CEO's wishes?
Can you help me and show the steps how to get the numbers on the pro forma income statement?