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 Administrative expenses Rent Actual cars washed Revenue Expenses: Cleaning supplies $ 0.04 For example, electricity costs should be $1,400 per month plus $0.07 per car washed. The company expects to wash 8,500 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 Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Month $ 1,400 $ 4,200 $ 8,400 $ 2,100 $ 1,400 Administrative expenses Total expenses Net operating income Cost per Car Washed 8,600 $ 58,200 $ 0.50 $ 0.07 $ 0.15 $ 0.20 4,750 1,965 1,515 6,260 8,400 2,300 1,640 26,830 $ 31,370 Required: Prepare a flexible budget performance report 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.

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 Administrative expenses Rent Actual cars washed Revenue Expenses: Cleaning supplies $ 0.04 For example, electricity costs should be $1,400 per month plus $0.07 per car washed. The company expects to wash 8,500 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 Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Month $ 1,400 $ 4,200 $ 8,400 $ 2,100 $ 1,400 Administrative expenses Total expenses Net operating income Cost per Car Washed 8,600 $ 58,200 $ 0.50 $ 0.07 $ 0.15 $ 0.20 4,750 1,965 1,515 6,260 8,400 2,300 1,640 26,830 $ 31,370 Required: Prepare a flexible budget performance report 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.

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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