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Big Bob's Burgers is justifiably famous for its whopping 1-pound hamburger made with fresh ground beer and cooked to order. Together with a side of "all you can eat" country style French fries, one of Big Bob's hamburgers makes for a very satisfying meal. On an average day, Big Bob serves 200 1-pound hamburgers. Big Bob budgets to use 225 pounds of ground beef to make 200 1-pound hamburgers because some hamburgers invariably are overcooked of dropped on the floor (and therefore must be discarded). Finally, Big Bob budgets to pay $3 per pound of ground beef.
For the most recent week (Big Bob's is open 7 days a week), Big Bob served 1,200 1-pound hamburgers using 1,250 pounds of ground beef for the 1,250 pounds of ground beef. In addition, Big Bob paid his supplier $3.20 per pound of ground beef for the 1,250 pounds he used during the week.
a. What were Big Bob's ground beef price and quantity variance for the most recent week?
b. What factor(s) could explain Big Bob's ground beef variances?
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