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 Rent Administrative expenses Fixed Cost per Month $1,400 $ 4,100 $ 8,100 $ 2,000 $1,500 Cost per Car Washed i $ 0.60 $ 0.05 $ 0.30 $ 0.20 $ 0.03 For example, electricity costs should be $1,400 per month plus $0.05 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed. The company actually washed 8,100 cars in August. Required: Calculate the company's activity variances 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 Rent Administrative expenses Fixed Cost per Month $1,400 $ 4,100 $ 8,100 $ 2,000 $1,500 Cost per Car Washed i $ 0.60 $ 0.05 $ 0.30 $ 0.20 $ 0.03 For example, electricity costs should be $1,400 per month plus $0.05 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed. The company actually washed 8,100 cars in August. Required: Calculate the company's activity variances 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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Exercise 9-11 (Algo) Activity Variances [LO9-2]
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
Fixed
Cost per Cost per
Month
Car Washed
$ 0.60
$ 0.05
$ 1,400
$ 4,100
$ 8,100
$ 2,000
$ 1,500
$0.30
$0.20
$ 0.03
For example, electricity costs should be $1,400 per month plus $0.05 per car washed. The company expects to wash 8,000 cars in
August and to collect an average of $6.10 per car washed. The company actually washed 8,100 cars in August.
Required:
Calculate the company's activity variances 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.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5acb05d7-8149-4f9a-8a19-7e8e0a475ee8%2Fa00677e0-2452-43c3-bc97-69a4ea6df24c%2F9ls3au8_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 9-11 (Algo) Activity Variances [LO9-2]
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
Fixed
Cost per Cost per
Month
Car Washed
$ 0.60
$ 0.05
$ 1,400
$ 4,100
$ 8,100
$ 2,000
$ 1,500
$0.30
$0.20
$ 0.03
For example, electricity costs should be $1,400 per month plus $0.05 per car washed. The company expects to wash 8,000 cars in
August and to collect an average of $6.10 per car washed. The company actually washed 8,100 cars in August.
Required:
Calculate the company's activity variances 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.
Transcribed Image Text:Required:
Calculate the company's activity variances 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
Activity Variances
For the Month Ended August 31
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Administrative expenses
Total expenses
Net operating income
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