Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table provides data concerning the company's costs: Fixed Cost per Month Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Cost per Car Washed $ 2,300 5,600 9,200 3,000 2,700 $1.00 Variable expenses: 0.40 0.60 0.70 0.07 The company expects to charge customers an average of $8.70 per car washed. Required: Prepare a flexible budget for October assuming either 6,000 or 7,000 cars are washed. AUTO LAVAGE INC. Flexible Budget For the Month Ended October 31 Budgeted Amount Per Unit (per car) Cars Washed 6,000 7,000
Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table provides data concerning the company's costs: Fixed Cost per Month Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Cost per Car Washed $ 2,300 5,600 9,200 3,000 2,700 $1.00 Variable expenses: 0.40 0.60 0.70 0.07 The company expects to charge customers an average of $8.70 per car washed. Required: Prepare a flexible budget for October assuming either 6,000 or 7,000 cars are washed. AUTO LAVAGE INC. Flexible Budget For the Month Ended October 31 Budgeted Amount Per Unit (per car) Cars Washed 6,000 7,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Auto Lavage is a Canadian company that owns and operates a large automatic
carwash facility near Quebec. The following table provides data concerning the
company's costs:
Fixed Cost
per Month
Cleaning
supplies
Electricity
Maintenance
Wages and
salaries.
Depreciation
Rent
Administrative
expenses
$ 2,300
Cost per
Car Washed
5,600
9,200
3,000
Fixed expenses:
2,700
Variable expenses:
$ 1.00
Total variable expenses
0.40
The company expects to charge customers an average of $8.70 per car washed.
Total fixed expenses
0.60
Required:
Prepare a flexible budget for October assuming either 6,000 or 7,000 cars are
washed.
0.70
0.07
AUTO LAVAGE INC.
Flexible Budget
For the Month Ended October 31
Budgeted
Amount
Per Unit
(per car)
Cars Washed
6,000
7,000
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