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3. Sell or further (10 marks) Kid toys Inc manufactured 200 racing cars that were defective. The manufacturing costs of the cars were: Paper B Page 3 total 4 pages S30 24 10 Direct materials Direct labour Variable overhead Fixed overhead 12 Total cost $76 The racing cars normally sell for $110 each. The company can rework the defective cars, which will cost $25 for direct materials, $10 for direct labour and $5 for variable overhead. No additional fixed overhead will be incurred. Alternatively, company can sell the cars 'as is' for a price of $80. Required: Should the company sell or process the defective cars further