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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Lavage Rapide 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 $ 0.01 For example, electricity costs should be $1,100 per month plus $0.08 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.60 per car washed. The company actually washed 8.300 cars in August. Fixed Cost Cost per per Month Car Washed $0.40 $ 0.08 $1,100. $ 0.25 $ 4,400 $ 0.40 $ 8,400 Revenue Expenses 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., zero variance). Input all amounts as positive values. $2,000 $1,600 Cleaning supplies Electricity Lavage Rapide Activity Variances For the Month Ended August 31
Lavage Rapide 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 For example, electricity costs should be $1,300 per month plus $0.08 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. Revenue Expenses: Fixed Cost per Cost per Month Car Washed $ 1,300 $4,400 $ 8,300 $2,000 $ 1,700 Lavage Rapide Activity Variances For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent $ 0.70 $ 0.08 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., zero variance). Input all amounts as positive values.…
Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $22.50 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers-particularly those located on remote ranches that require considerable travel time. The owner's daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below: Activity Cost Pool Cleaning carpets Travel to jobs Job support Other (organization-sustaining costs and idle capacity costs) Activity Measure Square feet cleaned (00s) Miles driven Number of jobs None Activity for the Year 7,000 hundred square feet 266,500 miles 1,600…
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