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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 Rent Administrative expenses 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 expe wash 8,000 cars in August and to collect an average of $6.70 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 Administrative expenses Total expense Net operating income $ 1,200 $ 4,100 $ 8,200 $ 1,800 $ 1,800 Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $ 0.40 8,100 $ 55,700 5,300 1,650 1,440 7,660 $ 0.01 8,200 2,000 1,780 28,030 $ 27,670

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 Rent Administrative expenses 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 expe wash 8,000 cars in August and to collect an average of $6.70 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 Administrative expenses Total expense Net operating income $ 1,200 $ 4,100 $ 8,200 $ 1,800 $ 1,800 Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $ 0.40 8,100 $ 55,700 5,300 1,650 1,440 7,660 $ 0.01 8,200 2,000 1,780 28,030 $ 27,670

FINANCIAL ACCOUNTING
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: 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 8,000 cars in August and to collect an average of $6.70 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 Administrative expenses Total expense Net operating income $ 1,200 $ 4,100 $ 8,200 $ 1,800 $ 1,800 Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $ 0.40 8,100 $ 55,700 $ 0.01 5,300 1,650 1,440 7,660 8,200 2,000 1,780 28,030 $ 27,670
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 8,000 cars in August and to collect an average of $6.70 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 Administrative expenses Total expense Net operating income $ 1,200 $ 4,100 $ 8,200 $ 1,800 $ 1,800 Cost per Car Washed $ 0.60 $ 0.06 $ 0.15 $ 0.40 8,100 $ 55,700 $ 0.01 5,300 1,650 1,440 7,660 8,200 2,000 1,780 28,030 $ 27,670
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. Revenue Expenses: Lavage Rapide Revenue and Spending Variances For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income
Transcribed Image Text: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. Revenue Expenses: Lavage Rapide Revenue and Spending Variances For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income
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