Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning the company’s costs: Fixed Cost per MonthCost per Car WashedCleaning supplies $ 0.40Electricity$ 1,200$ 0.07Maintenance $ 0.15Wages and salaries$ 4,100$ 0.20Depreciation$ 8,300 Rent$ 1,900 Administrative expenses$ 1,500$ 0.02 For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company actually washed 8,500 cars in August and collected an average of $6.90 per car washed.Required:Prepare the company’s flexible budget for August. ### Lavage Rapide Flexible Budget**For the Month Ended August 31**#### Revenue- [Revenue Amount]#### Expenses:- **Cleaning Supplies:** [Amount]- **Electricity:** [Amount]- **Maintenance:** [Amount]- **Wages and Salaries:** [Amount]- **Depreciation:** [Amount]- **Rent:** [Amount]- **Administrative Expenses:** [Amount]#### Total Expense- [Total Expenses Amount]#### Net Operating Income- [Net Operating Income Amount]This table presents a flexible budget for Lavage Rapide, detailing revenue and various expenses for the month ending August 31. It includes specific categories such as cleaning supplies, electricity, maintenance, wages and salaries, depreciation, rent, and administrative expenses. The total expenses are calculated, leading to the determination of net operating income.

A flexible budget is a useful tool that helps businesses evaluate their performance in various…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning the company’s costs:

	Fixed Cost per Month	Cost per Car Washed
Cleaning supplies		$ 0.40
Electricity	$ 1,200	$ 0.07
Maintenance		$ 0.15
Wages and salaries	$ 4,100	$ 0.20
Depreciation	$ 8,300
Rent	$ 1,900
Administrative expenses	$ 1,500	$ 0.02

For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company actually washed 8,500 cars in August and collected an average of $6.90 per car washed.

Required:

Prepare the company’s flexible budget for August.

### Lavage Rapide Flexible Budget
**For the Month Ended August 31**

#### Revenue
- [Revenue Amount]

#### Expenses:
- **Cleaning Supplies:** [Amount]
- **Electricity:** [Amount]
- **Maintenance:** [Amount]
- **Wages and Salaries:** [Amount]
- **Depreciation:** [Amount]
- **Rent:** [Amount]
- **Administrative Expenses:** [Amount]

#### Total Expense
- [Total Expenses Amount]

#### Net Operating Income
- [Net Operating Income Amount]

This table presents a flexible budget for Lavage Rapide, detailing revenue and various expenses for the month ending August 31. It includes specific categories such as cleaning supplies, electricity, maintenance, wages and salaries, depreciation, rent, and administrative expenses. The total expenses are calculated, leading to the determination of net operating income.

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