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 cost per month Cost per car washed Cleaning supplies $0.40 Electricity $1,200 $0.08 Maintaince $0.25 Wages and salaries $4,000 $0.30 Depreciation $8,000 Rent $1,900 Administrative expenses $1,500 $0.03 For example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.00 per car washed. The actual operating results for August are as follows: Actual cars washed 8,600 Revenue $53,100 Expenses: Cleaning supplies 3,900 Electricity 1,850 Maintaince 2,365 Wages and salaries 6,910 Depreciation 8,000 Rent 2,100 Administrative expenses 1,665 Total expenses $26,780 Net operating income $26,320 Calculate the company's revenue and spending variances for August.
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 cost per month Cost per car washed
Cleaning supplies $0.40
Electricity $1,200 $0.08
Maintaince $0.25
Wages and salaries $4,000 $0.30
Rent $1,900
Administrative expenses $1,500 $0.03
For example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.00 per car washed.
The actual operating results for August are as follows:
Actual cars washed 8,600
Revenue $53,100
Expenses:
Cleaning supplies 3,900
Electricity 1,850
Maintaince 2,365
Wages and salaries 6,910
Depreciation 8,000
Rent 2,100
Administrative expenses 1,665
Total expenses $26,780
Net operating income $26,320
Calculate the company's revenue and spending variances for August.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
