Question: Redd Inc. is considering two alternative for producing using a with a fixed cost of $5,000 and variable costs of $1.00 per mask. Method 2

Redd Inc. is considering two alternative for producing using a with a fixed cost of $5,000 and variable costs of $1.00 per mask. Method 2 would use a less expensive machine with a fixed cost of only $1,000, but it would require a variable cost of $1.50 per mask. The sales price per mask would be the same under each method. At what unit output level would the two methods provide the same operating income (EBIT)?

O a. 8,000

O b. 13,500

O c. 17.100

O d. 15.000

O e. 15,300

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