Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following tableprovides estimates concerning the company's costs:FixedCost perMonthCost perCar WashedCleaning supplies$ 0.70Electricity$ 1,200$ 0.07Maintenance$ 0.25Wages and salaries$ 4,900$ 0.30Depreciation$ 8,100Rent$ 2,000Administrative expenses$ 1,500$ 0.05For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company expects to wash 8,500 cars inAugust and to collect an average of $6.30 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 (i.e., zerovariance). Input all amounts as positive values.Lavage RapideActivity VariancesFor the Month Ended August 31RevenueExpenses:Cleaning suppliesElectricityMaintenanceWages and salariesDepreciationRentAdministrative expensesTotal expenseNet operating income

Activity Variances are the items that differs between the budgeted and the actual activity levels.…

Answered: Lavage Rapide is a Canadian company…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4EA: Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on...

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Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)
Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)
Steuben Company produces dog houses. During the current year, Steuben Company incurred the following costs: Rent on manufacturing facility Office manager's salary Wages of factory machine operators Depreciation on manufacturing equipment Insurance and taxes on selling and administrative offices Direct materials purchased and used Multiple Choice Based on the above information, the amount of period costs shown on Steuben's income statement is: O $70,000 $5,000 $186,000 $116,000 65,000 45,000 15,000 $65,000 5,000 75,000
Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility nearMontreal. The following table provides data concerning the company’s costs:Fixed Cost Cost per Carper Month WashedCleaning supplies ...................... $0.80Electricity .................................. $1,200 $0.15Maintenance ............................ $0.20Wages and salaries ................. $5,000 $0.30Depreciation .............................. $6,000Rent .......................................... $8,000Administrative expenses .......... $4,000 $0.10For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects towash 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.
Steuben Company produces dog houses. During the current year, Steuben Company Incurred the following costs: Rent on manufacturing facility Office manager's salary Wages of factory machine operators Depreciation on manufacturing equipment Multiple Choice Insurance and taxes on selling and administrative offices Direct materials purchased and used Based on the above information, the amount of perlod costs shown on Steuben's Income statement is: O $18,000 $96,000 $224,000 $ 128,000 78,000 58,000 $78,000 28,000 18,000 88,000
Which of the following costs is a mixed cost? a.straight-line depreciation on factory equipment b.electricity costs of $3 per kilowatt-hour c.salary of a factory supervisor d.rental costs of $10,000 per month plus $0.30 per machine hour of use
West Co.'s manufacturing costs are as follows: Direct material and direct labor Other variable manufacturing costs $700,000 $100,000 Depreciation of factory building and manufacturing equipment $80,000 Other fixed manufacturing overhead $18,000 What amount should be considered product costs for external reporting purposes if the company uses absorption costing? A. $700,000 B. $800,000 C. $880,000 D. $898,000
Accounting PH enterprises manufactures automobiles accessories and parts. Following are the informationrelating to the production of 3 lakh units.Direct Material cost 2400000rsDirect Labor cost 32,00,000rsVariable factory OH 20,00,000rsFixed factory OH 20,00,000rsThe purchase price of the component is Rs. 30. The fixed OH would continue to be incurred evenwhen the component is brought from outside, although there would have been reduction in thecost to the extent of Rs. 10 lakh. Decide whether the parts should be made or bought underthe current situation If the released capacity can be rented for Rs. 8 lakh
I b) Refer to the following data: Direct material used $180 000 Advertising costs $ 5 000 Indirect labour $ 8 000 Rent on corporate office $ 20 000 Depreciation on factory equipment $ 60 000 Direct labour $ 30 000 Factory cleaners wages $ 20 000 Indirect materials $ 35 000 Required (show your workings for each question): Determine each of the following costs: (list the costs under each cost category when calculating the answer). Period costs
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…
Sheddon Industries produces two products. The products' identified costs are as follows: Product A Product B Direct materials $20,000 $15,000 Direct labor $12,000 $24,000 The company's overhead costs of $108,000 are allocated based on direct labor cost. Assume 4,000 units of product A and 5,000 units of Product B are produced. What is the cost per unit for product B? (Do not round your intermediate calculations.)
Which of the following is an example of a mixed cost? a.rental costs of $10,000 per month plus $0.30 per machine hour of use b.straight-line depreciation on factory equipment c.salary of a factory supervisor d.electricity costs of $3 per kilowatt-hour

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