Jacobs Inc. 2012 sells purses at $35.00 and has an earned income is $67,500. The company would like to have a net income of $7,500 more in 2013. The fixed cost is expected to remain at the current amount of $30,000. The company's variable costs will remain stable at 12.5% of sales. This rate is expected to continue to 2013.
1. Calculate the required sales to meet the target net income for 2013
2. Give two ways the company could earn their target net income of $87,500.