E9-10 Flexible Budget [ LO9-1] Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost Cost per per Month Car Washed Cleaning supplies Bectricity Mavitanance Wages and salaries Depreciation Rent Administrative expenses $0.80 $1,200 $0.15 40.20 $0.30 ....... ... $5,000 $6.000 $8.000 $4,000 ............. .. $0.10 For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects to wash 9.000 cars in August and to collect an average of $4.90 per car washed. Required: Prepare the company's planning budget for August. WE DID THIS IN CLASS.
E9-10 Flexible Budget [ LO9-1] Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost Cost per per Month Car Washed Cleaning supplies Bectricity Mavitanance Wages and salaries Depreciation Rent Administrative expenses $0.80 $1,200 $0.15 40.20 $0.30 ....... ... $5,000 $6.000 $8.000 $4,000 ............. .. $0.10 For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects to wash 9.000 cars in August and to collect an average of $4.90 per car washed. Required: Prepare the company's planning budget for August. WE DID THIS IN CLASS.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
![Based on E9-10 that we did in class, (the planning budget), prepare E9-12 (the flexible budget) and
E9-14 ( the Flexible Budget Performance Report.
SEE EXHIBIT 9-8 ON PAGE 402 OF THE TEXT FOR AN EXAMPLE ON HOW TO SET UP.
ements
E9-10 Flexible Budget [Q L09-1]
Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning
the company's costs:
Fixed Cost
Cost per
Car Washed
per Month
Cleaning suppilies
$0.80
Bectricity
. .
$1,200
$0.15
$0.20
$0.30
Maintanance
Wages and salaries
Depreciation
Rent....
Administrative expenses
$5,000
$0.000
$8.000
$4,000
$0.10
For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects to wash 9,000 cars in
August and to collect an average of $4.90 per car washed.
Required:
Prepare the company's planning budget for August. - WE DID THIS IN CLASS.
EXERCISE 9-11 Flexible Budget (e LO9-1]
Refer to the data for Lavage Rapide in e Exercise 9-10. The company actually washed 8.800 cars in August.
Required:
Prepare the company's flexible budget for August.
EXERCISE 9-12 Prepare a Report Showing Activity Variances [e LO9-2]
Refer to the data for Lavage Rapide in
Exercise 9-10. The actual operating results for August appear below.
Lavage Rapide
Income Statement
For the Month Ended August 31
Actual cars washed
8,800
Revenue
$43,080
Expenses:
Cleaning supplies
Electricity
Maintenance
Wages and saiaries
Depreciation.
Rent....
Administrative expenses
Total expense
7,580
2,670
2,260
8,500
6,000
8,000
4,950
....
39,940
Net operating income
$ 3,140
EXERCISE 9-14 Prepare a Flexible Budget Performance Report [e LO9-4]
Refer to the data for Lavage Rapide in e Exercises 9-10 and Q Exercises 9-12-
Required:
Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for August](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F81fecbd1-b81e-4694-afba-0e029fedd469%2Fae0071c2-5ead-4b08-a26e-8426cd7079b4%2Fui0ujwq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Based on E9-10 that we did in class, (the planning budget), prepare E9-12 (the flexible budget) and
E9-14 ( the Flexible Budget Performance Report.
SEE EXHIBIT 9-8 ON PAGE 402 OF THE TEXT FOR AN EXAMPLE ON HOW TO SET UP.
ements
E9-10 Flexible Budget [Q L09-1]
Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning
the company's costs:
Fixed Cost
Cost per
Car Washed
per Month
Cleaning suppilies
$0.80
Bectricity
. .
$1,200
$0.15
$0.20
$0.30
Maintanance
Wages and salaries
Depreciation
Rent....
Administrative expenses
$5,000
$0.000
$8.000
$4,000
$0.10
For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects to wash 9,000 cars in
August and to collect an average of $4.90 per car washed.
Required:
Prepare the company's planning budget for August. - WE DID THIS IN CLASS.
EXERCISE 9-11 Flexible Budget (e LO9-1]
Refer to the data for Lavage Rapide in e Exercise 9-10. The company actually washed 8.800 cars in August.
Required:
Prepare the company's flexible budget for August.
EXERCISE 9-12 Prepare a Report Showing Activity Variances [e LO9-2]
Refer to the data for Lavage Rapide in
Exercise 9-10. The actual operating results for August appear below.
Lavage Rapide
Income Statement
For the Month Ended August 31
Actual cars washed
8,800
Revenue
$43,080
Expenses:
Cleaning supplies
Electricity
Maintenance
Wages and saiaries
Depreciation.
Rent....
Administrative expenses
Total expense
7,580
2,670
2,260
8,500
6,000
8,000
4,950
....
39,940
Net operating income
$ 3,140
EXERCISE 9-14 Prepare a Flexible Budget Performance Report [e LO9-4]
Refer to the data for Lavage Rapide in e Exercises 9-10 and Q Exercises 9-12-
Required:
Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for August
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