Question 3 (a) A company budgeted to sell 7,500 units of a product in a month at a standard selling price of RM20 each. The standard cost of the product is RM14 per unit. During the month actual sales of the product were 7,720 units with revenue of RM152,470. Required: Calculate the sales price variance and the sales volume profit variance for the month. (6 marks) (b) An education authority is considering the implementation of a CCTV (closed circuit television) security system in one of its schools. Details of the proposed project are as follows: Life of project 5 years Initial cost RM75,000 Annual savings in cash RM25,000 Cost of capital 15% Relevant discount factors being as follows: Year 2 3 4 5 Discount factor at 10% 0.909 0.826 0.751 0.683 0.621 Discount factor at 15% 0.870 0.756 0.658 0.572 0.497 Discount factor at 20% 0.833 0.694 0.579 0.482 0.402 Required: (i) Compute the net present value for the proposed project. (4 marks) (ii) Calculate the internal rate of return for the proposed project. (7 marks) (iii)State your recommendation whether the proposed project should be invested and briefly provide reasons for your recommendation. (3 marks) [20 Marks]