pital Structure- Operating Leverage Use the following information: Almost Anything Goes Inc. (AAG Inc.) produces widgets \& reports the following: Unit Price =$100 Total Fixed Costs =$200,000 \# of units procedure & sold =5,000 Unit Variable Costs =$50 EBIT=$50,000 Assets =$500,000 Equity =$500,000 AAG Inc. is considering changes to its production procedures for which would: Add an additional $400,000 to Assets and $50,000 to Fixed Costs The result of the change in production procedures is a reduction in Unit Variable Costs =$40 (vs. $50 before) \# of units procedure & sold =7,000 (vs. 5,000 before) Unit Price =$95 (vs. $100 before) Assume no taxes and no debt. a) Should AAG Inc. make the change to its production procedures? a. Determine new EBIT b. Determine incremental EBIT c. What is the rate of return on the new investment? b) Would AAG Inc.'s breakeven-point increase or decrease if the change is made? a. Answer by determining breakeven quantity before and after the change is made