For Crane Company, variable costs are \( 63 \% \) of sales, and fixed costs are \( \$ 197,000 \). Management's net income goal is \( \$ 69,400 \). Compute the required sales dollars needed to achieve management's target net income of \( \$ 69,400 \). (Use the contribution margin technique.) Required sales \( \$ \square \)

To achieve the target net income of $69,400, we first calculate the contribution margin. With variable costs at 63% of sales, the contribution margin ratio is: \[ 100\% - 63\% = 37\% \] Now, using the formula for net income: \[ \text{Net Income} = \text{Sales} - \text{Variable Costs} - \text{Fixed Costs} \] This can be rewritten in terms of contribution margin: \[ \text{Net Income} = \text{Contribution Margin} \times \text{Sales} - \text{Fixed Costs} \] Plugging in the numbers: \[ 69,400 = 0.37 \times \text{Sales} - 197,000 \] Adding $197,000 to both sides gives: \[ 66,400 = 0.37 \times \text{Sales} \] Now solving for Sales: \[ \text{Sales} = \frac{66,400}{0.37} \approx 179,459.46 \] So, the required sales is approximately: \[ \text{Required sales} = \$ 179,459.46 \]