Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost per Month $ 1,300 $ 4,100 $ 8,400 $ 2,000 Administrative expenses $ 1,700 $ 0.05 Cleaning supplies Electricity Maintenance Wages and salaries. Depreciation Rent For example, electricity costs are $1,300 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.30 per car washed. Required: Prepare the company's planning budget for August. Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $0.30 Administrative expenses Total expense Net operating income $ 0 0

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost per Month $ 1,300 $ 4,100 $ 8,400 $ 2,000 Administrative expenses $ 1,700 $ 0.05 Cleaning supplies Electricity Maintenance Wages and salaries. Depreciation Rent For example, electricity costs are $1,300 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.30 per car washed. Required: Prepare the company's planning budget for August. Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $0.30 Administrative expenses Total expense Net operating income $ 0 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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: Cost per Car Washed Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost per Month $ 0.80 $ 1,200 $ 0.06 $ 0.15 $ 4,600 $ 0.40 $ 8,300 $ 1,900 $ 1,300 $ 0.04 For example, electricity costs should be $1,200 per month plus $0.06 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.70 per car washed. The company actually washed 8,100 cars in August. Required: Calculate the company's 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 Activity Variances
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 Costper Month Cost perCar Washed Cleaning supplies $ 0.80 Electricity $ 1,200 $ 0.15 Maintenance $ 0.20 Wages and salaries $ 5,000 $ 0.30 Depreciation $ 6,000 Rent $ 8,000 Administrative expenses $ 4,000 $ 0.10 For example, electricity costs should be $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. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,800 Revenue $ 43,080 Expenses: Cleaning supplies 7,560 Electricity 2,670 Maintenance 2,260 Wages and salaries 8,500 Depreciation 6,000 Rent 8,000…
Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost Cost per Car per Month cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Washed $ 0.80 $ 1,200 $ 0.15 $ 0.20 $ 5,000 $ 0.30 $ 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. Lavage Rapide Planning Budget For the Month Ended August 31 Budgeted cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income 0 S 0
Lavage Rapide 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 Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 0.50 $ 0.06 $ 1,100 $ 0.15 $ 5,000 $ 0.30 $ 8,200 $1,900 $ 1,400 $ 0.05 For example, electricity costs should be $1,100 per month plus $0.06 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.80 per car washed. The company actually washed 8,600 cars in August. Required: Calculate the company's activity variances for August. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values. Revenue Lavage Rapide Activity Variances For the Month Ended August 31 $ 58,480 None Expenses: Cleaning supplies 4,300 F Electricity 1,616 F…
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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 Costper Month Cost perCar Washed Cleaning supplies $ 0.80 Electricity $ 1,200 $ 0.15 Maintenance $ 0.20 Wages and salaries $ 5,000 $ 0.30 Depreciation $ 6,000 Rent $ 8,000 Administrative expenses $ 4,000 $ 0.10 For example, electricity costs should be $1,200 per month plus $0.15 per car washed. The company actually washed 8,800 cars in August and collected an average of $4.90 per car washed. Required: Prepare the company’s flexible budget for August.
Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.70 Electricity $ 1,100 $ 0.10 Maintenance $ 0.15 Wages and salaries $ 4,400 $ 0.30 Depreciation $ 8,100 Rent $ 2,100 Administrative expenses $ 1,300 $ 0.04 For example, electricity costs are $1,100 per month plus $0.10 per car washed. The company actually washed 8,500 cars in August and collected an average of $6.60 per car washed. Required: Prepare the company’s flexible budget for August.
Jake's Roof Repair has provided the following data concerning its costs: Fixed Cost Cost per per Month Repair-Hour Wages and salaries $ 21,400 $ 15.00 Parts and supplies $ 7.30 Equipment depreciation $ 2,730 $ 0.60 Truck operating expenses $ 5,800 $ 1.90 Rent $ 4,690 Administrative expenses $ 3,890 $ 0.60 For example, wages and salaries should be $21,400 plus $15.00 per repair-hour. The company expected to work 3,000 repair-hours in May, but actually worked 2,900 repair-hours. The company expects its sales to be $45.00 per repair-hour. Required: Compute the company's activity variances for May. (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.) Revenue Expenses: Jake's Roof Repair Activity Variances For the Month Ended May 31 Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses Total expense Net…
Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.80 Electricity $ 1,200 $ 0.15 Maintenance $ 0.20 Wages and salaries $ 5,000 $ 0.30 Depreciation $ 6,000 Rent $ 8,000 Administrative expenses $ 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. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,800 Revenue $ 43,080 Expenses: Cleaning supplies 7,560 Electricity 2,670 Maintenance 2,260 Wages and salaries 8,500 Depreciation 6,000 Rent 8,000 Administrative expenses 4,950 Total expense 39,940 Net operating…
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 $ 0.03 For example, electricity costs should be $1,000 per month plus $0.08 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 company actually washed 8,400 cars in August. Rent Revenue Expenses: Required: Calculate the company's activity variances for August. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero varlance). Input all amounts as positive values.) Fixed Cost Cost per per Month Car Washed $ 0.50 $ 1,000 $ 0.08 $ 0.10 $ 0.30 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Lavage Rapide Activity Variances For the Month Ended…
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Skyler White, Inc. manufactures and sells two products: Jeeps and Cell Phones. The following information was extracted from the company's accounting records from last period. Jeeps Cell Phones Sales Revenue $300,000 $275,000 Product Costs $220,000 $150,000 Period Costs $25,000 $30,000 The Jeep product line has the following breakout of product costs: Direct Materials of $60,000, Direct Labor of $30,000, and Manufacturing Overhead of $35,000. The remaining product costs are traceable fixed manufacturing overhead costs. The period costs of the Jeep line are made up of $15,000 of Sales Commissions (which is paid as a percentage of sales revenue), and $10,000 of arbitrarily allocated common fixed costs. The Cell Phone line has a contribution margin percentage of 60%. Of the fixed costs in the Cell Phone line, $30,000 are traceable fixed costs and the remainder are arbitrarily allocated common fixed costs. Which of the following statements is incorrect? Question…