34. Component X is manufactured in the machine shop. The annual requirement of the component is 10,000 units. If it is bought out, the lowest quotation from an outside supplier is Rs. 8.00 per unit. The following expenses of the Machine shop apply to manufacturing of component X: Materials Rs. 35,000; Labour Rs. 56,000; Indirect Labour Rs. 12,000; Power and Fuel Rs. 600; Repairs and Maintenance Rs. 1,000; the sale of Machinery used for manufacture of the component X would reduce depreciation by Rs. 4,000 and Insurance by Rs. 2,000; If component X is bought out the following additional expenses are incurred: Freight Rs. 1.00 per unit, Inspection Rs. 10,000 per annum; You are required to prepare a report to the Managing Director showing the comparison of expenses to Machine shop when (i) component X is made and (ii) when bought out.