Answer:
$8,586,000
Explanation:
market price for Littlelaser $100 per unit
units sold 106,000
total revenue generated by Littlelaser = $100 x 106,000 = $10,600,000
required investment = $8,056,000
since the investors require a return on investment of 25%, then the profits generated by Littlelaser should be:
ROI = net income / total investment
25% x $8,056,00 = net income
net income = $2,014,000
target cost = total revenue - net income = $10,600,000 - $2,014,000 = $8,586,000
total revenue $10,600,000
<u>- total cost $8,596,000 </u>
net income $2,014,000
