An All-Equity Financed Firm Has $650 in Assets and the Stock

An all-equity financed firm has $650 in assets and the stock price is $20. If the firm restructures with 40 percent debt which creates interest expense of $17 per year and the firm's tax rate is 40 percent, what is the break-even EBIT?

A) $37.50
B) $31.50
C) $49.50
D) $42.50