Wave-Zone Company has 11,500 units of its sole product that it produced last year at a cost of $125 each. This year's model is superior to last year's and the 11,500 units cannot be sold for their regular selling price of $187.5 each. Wave-Zone has two alternatives for these items: (1) they can be sold to a wholesaler for $12.5 each, or (2) they can be reworked at a total cost of $530,000 and then sold for $56.25 each. The company has enough idle capacity to rework these items without affecting any new production. Which choice would increase the company's profits the most?

	Reworking, because profit will increase by $26,875 more than scrapping.
	Scrapping, because profit will increase by $26,875 more than reworking.
	Scrapping, because profit will increase by $143,750 more than reworking.
	Reworking because profit will increase by $143,750 more than scrapping.
	Reworking, because profit will increase by $116,875 more than scrapping.