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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 For Actual cars washed Revenue Wages and salaries Depreciation Rent Administrative expenses $ 0.01 For example, electricity costs should be $1,500 per month plus $0.09 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.80 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement Expenses: the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,500 $ 0.09 $ 4,100 $ 8,400 $ 2,200 $1,700 Administrative expenses Total expense Net operating income 8,400 $ 58,540 6,310 2,217 2,730 $ 0.30 $ 0.30 6,950 8,400 2,400 1,932 30,939 $ 27,601

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 For Actual cars washed Revenue Wages and salaries Depreciation Rent Administrative expenses $ 0.01 For example, electricity costs should be $1,500 per month plus $0.09 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.80 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement Expenses: the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,500 $ 0.09 $ 4,100 $ 8,400 $ 2,200 $1,700 Administrative expenses Total expense Net operating income 8,400 $ 58,540 6,310 2,217 2,730 $ 0.30 $ 0.30 6,950 8,400 2,400 1,932 30,939 $ 27,601

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 Rent Administrative expenses Lavage Rapide Income Statement $ 0.04 For example, electricity costs should be $1,500 per month plus $0.09 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.80 per car washed. The actual operating results for August are as follows: Actual cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Rent For the Month Ended August 31 Wages and salaries Depreciation Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,500 $ 4,100 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expense Net operating income 8,400 $ 58,540 6,310 2,217 2,730 $ 0.09 $ 0.30 $ 0.30 6,950 8,400 2,400 1,932 30,939 $ 27,601
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 Rent Administrative expenses Lavage Rapide Income Statement $ 0.04 For example, electricity costs should be $1,500 per month plus $0.09 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.80 per car washed. The actual operating results for August are as follows: Actual cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Rent For the Month Ended August 31 Wages and salaries Depreciation Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,500 $ 4,100 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expense Net operating income 8,400 $ 58,540 6,310 2,217 2,730 $ 0.09 $ 0.30 $ 0.30 6,950 8,400 2,400 1,932 30,939 $ 27,601
Required: Calculate the company's revenue and spending varlances 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 varlances 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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