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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 Administrative expenses Rent Actual cars washed Revenue Expenses: For example, electricity costs should be $1,300 per month plus $0.05 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Month $ 1,300 $ 4,900 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expenses Net operating income Cost per Car Washed $ 0.70 $ 0.05 $ 0.25 $ 0.30 8,600 $ 56,500 6,450 1,695 2,365 7,810 $ 0.02 8,400 2,400 1,770 30,890 $ 25,610 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

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: For example, electricity costs should be $1,300 per month plus $0.05 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Month $ 1,300 $ 4,900 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expenses Net operating income Cost per Car Washed $ 0.70 $ 0.05 $ 0.25 $ 0.30 8,600 $ 56,500 6,450 1,695 2,365 7,810 $ 0.02 8,400 2,400 1,770 30,890 $ 25,610 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

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 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 Electricity Maintenance For example, electricity costs should be $1,300 per month plus $0.05 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Wages and salaries. Depreciation Rent Administrative expenses Total expenses Net operating income Cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Fixed Cost per Cost per Month Car Washed $ 0.70 $1,300 $ 0.05 $ 0.25 $ 0.30 Rent $ 4,900 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expenses Net operating income 8,600 $ 56,500 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. Actual Results 6,450 1,695 2,365 1,770 30,890 $ 25,610 7,810 8,400 2,400 8,600 $ 56,500 $ 0.02 Lavage Rapide Flexible Budget Performance Report For the Month Ended August 31 6,450 1,695 2,365 7,810 8,400 2,400 1,770 30,890 $ 25,610 Revenue and Flexible Spending Variances Budget Activity Variances Planning Budget
Transcribed Image Text: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 Electricity Maintenance For example, electricity costs should be $1,300 per month plus $0.05 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.40 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Wages and salaries. Depreciation Rent Administrative expenses Total expenses Net operating income Cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Fixed Cost per Cost per Month Car Washed $ 0.70 $1,300 $ 0.05 $ 0.25 $ 0.30 Rent $ 4,900 $ 8,400 $ 2,200 $ 1,700 Administrative expenses Total expenses Net operating income 8,600 $ 56,500 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. Actual Results 6,450 1,695 2,365 1,770 30,890 $ 25,610 7,810 8,400 2,400 8,600 $ 56,500 $ 0.02 Lavage Rapide Flexible Budget Performance Report For the Month Ended August 31 6,450 1,695 2,365 7,810 8,400 2,400 1,770 30,890 $ 25,610 Revenue and Flexible Spending Variances Budget Activity Variances Planning Budget
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