You are comparing two possible capital structures for a firm. The first option is an allequity firm. The second option involves the use of $$3\mathrm{.}8$ mittion of debt. The breakeven point between these two financing options occurs when the earnings before interest and taves $($EBIT$)$ are $$428,000.$ Given this, you know that leverage is beneficial to the firm:

whenever EBIT is less than $$428,000.$

only when FBIT is $$428,000.$

whenever EBIT exceeds $$428,000.$

only if the debt is decreased by $$428,000.$

only if the debt is increased by $$428,000.$