Motor Components Ltd. have secured an order for 3,000 components per week from a car manufacturer but there is a shortage of available skilled labour capacity which is restraining the Company from producing the entire quantity within the Company, Production, cost and sales information of Motor Components Ltd. are as under : Sales price of complete component Rs. 1,500 Skilled Labour capacity per week 7,500 hours Production Labour rate per hour Rs. 120 Variable Production overhead Rs. 50% of labour cost Fixed Overhead Rs. 5,00,000 per week Testing cost for complete component Rs. 20 Each component is finally assembled from three section, make up of one or more parts as under: Section / Section 11 Section III Part per section 5 1 Material cost per part Rs. 60 Rs. 40 Rs. 20 Production labour minutes per part 18 mins. 15 mins. 30 mins. The sub-contract price for component Rs. 700 of Rs. 1,400 made up as Rs. 200 Rs. 500 The two production strategies available are : (a) to produce as many completed components as possible within the existing weekly skilled labour capacity and sub-contract the remaining complete components, and (b) produce as many of the three sections of the components as possible and subcontract the remaining section. Required : Advise which of the above two production strategies would be more profitable for the Company 4