The sales manager of a company engaged in the manufacture and sale of three products P, Q and R gives the following information for the month of October 1994:

Product Budget sales units sold Selling price per unit Standard contribution margin per unit P 2,000 Rs 12 Rs 6 Q 2,000 Rs 8 Rs 4 R 2,000 Rs 5 Rs 1 Actual sales:

P 1,500 units for Rs 15,000 Q 2,500 units for Rs 17,500 R 3,500 units for Rs 21,000

(a) You are required to calculate the following variances:

(i) Sales price variance

(ii) Sales volume variance

(iii) Sales quantity variance

(iv) Sales mix variance

(b) The cost of examining the cause of variances requires Rs 200 and the corrective action to be taken, if needed, requires Rs 300.

If there is 85% probability of the variances arising out of justifiable reasons and 15% probability of the situation going completely out of control, work out the total cost in carrying out a complete investigation.