Go to: www.accountingw... to download the problems. Module 9 examines variances. We learn to compute and interpret materials, labour, variable overhead and fixed overhead variances.
I think its because Direct Materials amount (kgs) used is budgeted on the $8 price, not the $7.50. In this case we priced the burger on the beef we planned to use, at the budgeted price. There are only 3 ways price variance is affected. The price changed, or the amount we used changed, or both changed.
