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 Fixed Cost per Month $ 1,300 $4,200 $8,200 $1,900 $ 1,600 Cost per Car Washed $ 0.80 $ 0.07 $ 0.10 $ 0.30 $ 0.01 For example, electricity costs should be $1,300 per month plus $0.07 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.50 per car washed. The actual operating results for August are as follows:

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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:
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Administrative expenses
Rent
For example, electricity costs should be $1,300 per month plus $0.07 per car washed. The company expects to wash 8,300 cars in
August and to collect an average of $6.50 per car washed.
The actual operating results for August are as follows:
For
Actual cars washed
Revenue
Expenses:
Lavage Rapide
Income Statement
the Month Ended August 31
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Cost per
Fixed Cost
per Month Car Washed
$0.80
$ 1,300
$ 0.07
$ 0.10
$ 4,200
$ 0.30
$ 8,200
$ 1,900
$ 1,600
Administrative expenses
Total expense
Net operating income
8,400
$ 56,050
$ 0.01
7,140
1,851
1,070
7,050
8,200
2,100
1,583
28,994
$ 27,056
Required:
Calculate the company's revenue and spending variances for August.
Note: 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: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 For example, electricity costs should be $1,300 per month plus $0.07 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.50 per car washed. The actual operating results for August are as follows: For Actual cars washed Revenue Expenses: Lavage Rapide Income Statement the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Cost per Fixed Cost per Month Car Washed $0.80 $ 1,300 $ 0.07 $ 0.10 $ 4,200 $ 0.30 $ 8,200 $ 1,900 $ 1,600 Administrative expenses Total expense Net operating income 8,400 $ 56,050 $ 0.01 7,140 1,851 1,070 7,050 8,200 2,100 1,583 28,994 $ 27,056 Required: Calculate the company's revenue and spending variances for August. Note: 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.
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