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:Cleaning suppliesElectricityMaintenanceWages and salaries.DepreciationAdministrative expensesRentActual cars washed.RevenueExpenses:Lavage RapideIncome StatementFor the Month Ended August 31Cleaning suppliesFor example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,100 cars inAugust and to collect an average of $6.60 per car washed.The actual operating results for August are as follows:ElectricityMaintenanceWages and salaries.DepreciationRentFixedCost perMonth$ 1,200$ 4,800$ 8,400$ 1,900$ 1,600Administrative expensesTotal expenseNet operating incomeCost perCar Washed$ 0.708,200$ 55,560$ 0.08$ 0.10$ 0.206,1701,8181,0506,7808,4002,1001,66227,980$ 27,580$ 0.02Required:Calculate the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" forfavorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) RevenueExpenses:Lavage RapideRevenue and Spending VariancesFor the Month Ended August 31Cleaning suppliesElectricityMaintenanceWages and salariesDepreciationRentAdministrative expensesTotal expenseNet operating income

The revenue and spending variance is the difference between actual results and flexible budget data…

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 $ 0.02 For example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,100 cars in August and to collect an average of $6.60 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 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Fixed Cost per Month $ 1,200 $ 4,800 $ 8,400 $ 1,900 $1,600 Rent Administrative expenses Total expense Net operating income Cost per Car Washed 8,200 $ 55,560 6,170 1,818 1,050 6,780 8,400 $ 0.70 $ 0.08 $ 0.10 $ 0.20 2,100 1,662 27,980 $ 27,580 Required: Calculate the company's revenue and spending 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 $ 0.02 For example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,100 cars in August and to collect an average of $6.60 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 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Fixed Cost per Month $ 1,200 $ 4,800 $ 8,400 $ 1,900 $1,600 Rent Administrative expenses Total expense Net operating income Cost per Car Washed 8,200 $ 55,560 6,170 1,818 1,050 6,780 8,400 $ 0.70 $ 0.08 $ 0.10 $ 0.20 2,100 1,662 27,980 $ 27,580 Required: Calculate the company's revenue and spending 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.)

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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