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: Cleaning supplies Electricity Maintenance Rent Wages and salaries. Depreciation Administrative expenses For example, electricity costs should be $1,200 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement the Month Ended August 31 For Actual cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries. Depreciation Rent Fixed Cost per Month $ 1,200 Administrative expenses Total expense Net operating income Cost per Car Washed $ 0.60 $ 0.06 $ 0.25 $ 0.30 $ 4,900 $ 8,100 $ 1,900 $ 1,600 8,500 $ 55,860 5,540 1,674 2,340 7,780 8,100 2,100 1,752 29,286 $ 26,574 $ 0.03 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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: Cleaning supplies Electricity Maintenance Rent Wages and salaries. Depreciation Administrative expenses For example, electricity costs should be $1,200 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement the Month Ended August 31 For Actual cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries. Depreciation Rent Fixed Cost per Month $ 1,200 Administrative expenses Total expense Net operating income Cost per Car Washed $ 0.60 $ 0.06 $ 0.25 $ 0.30 $ 4,900 $ 8,100 $ 1,900 $ 1,600 8,500 $ 55,860 5,540 1,674 2,340 7,780 8,100 2,100 1,752 29,286 $ 26,574 $ 0.03 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text: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:
Cleaning supplies
Electricity
Maintenance
Wages and salaries.
Depreciation
Administrative expenses
Rent
Actual cars washed
Revenue
Expenses:
Cleaning supplies
Electricity
Maintenance
For example, electricity costs should be $1,200 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in
August and to collect an average of $6.40 per car washed.
The actual operating results for August are as follows:
Lavage Rapide
Income Statement
For the Month Ended August 31
Wages and salaries
Depreciation
Rent
Fixed Cost
per Month
$ 1,200
$ 4,900
$ 8,100
$ 1,900
$ 1,600
Administrative expenses
Total expense
Net operating income
Cost per
Car Washed
$ 0.60
$ 0.06
$ 0.25
$0.30
8,500
$ 55,860
5,540
1,674
2,340
7,780
8,100
$ 0.03
2,100
1,752
29, 286
$ 26,574
Required:
Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for
August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values.)
Transcribed Image Text:Cars washed
Revenue
Expenses:
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Administrative expenses
Total expense
Net operating income
Lavage Rapide
Flexible Budget Performance Report
For the Month Ended August 31
Actual
Results
8,500
$ 55,860
$
5,540
1,674
2,340
7,780
8,100
2,100
1,752
29,286
26,574
Flexible
Budget
Planning
Budget
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education