Lavage Rapide 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 $ 0.60 Electricity $ 1,200 $ 0.07 Maintenance $ 0.15 Wages and salaries $ 4,700 $ 0.40 Depreciation $ 8,500 Rent $ 2,000 Administrative expenses $ 1,700 $ 0.04 For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.20 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 8,600 Revenue $ 54,800 Expenses: Cleaning supplies 5,600 Electricity 1,765 Maintenance 1,515 Wages and salaries 8,460 Depreciation 8,500 Rent 2,200 Administrative expenses 1,940 Total expenses 29,980 Net operating income $ 24,820 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. please answer do not image.
Lavage Rapide 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 $ 0.60 Electricity $ 1,200 $ 0.07 Maintenance $ 0.15 Wages and salaries $ 4,700 $ 0.40 Depreciation $ 8,500 Rent $ 2,000 Administrative expenses $ 1,700 $ 0.04 For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.20 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 8,600 Revenue $ 54,800 Expenses: Cleaning supplies 5,600 Electricity 1,765 Maintenance 1,515 Wages and salaries 8,460 Depreciation 8,500 Rent 2,200 Administrative expenses 1,940 Total expenses 29,980 Net operating income $ 24,820 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. please answer do not image.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 1E: Classify Costs Following is a list of various costs incurred in producing replacement automobile...
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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:
Fixed Cost per Month | Cost per Car Washed | ||
---|---|---|---|
Cleaning supplies | $ 0.60 | ||
Electricity | $ 1,200 | $ 0.07 | |
Maintenance | $ 0.15 | ||
Wages and salaries | $ 4,700 | $ 0.40 | |
$ 8,500 | |||
Rent | $ 2,000 | ||
Administrative expenses | $ 1,700 | $ 0.04 |
For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.20 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 | 8,600 |
Revenue | $ 54,800 |
Expenses: | |
Cleaning supplies | 5,600 |
Electricity | 1,765 |
Maintenance | 1,515 |
Wages and salaries | 8,460 |
Depreciation | 8,500 |
Rent | 2,200 |
Administrative expenses | 1,940 |
Total expenses | 29,980 |
Net operating income | $ 24,820 |
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.
please answer do not image.
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