Lavage Rapide owns and operates a large automatic car wash facility near Montreal. The following table provides estimatesconcerning the company's costs:Cleaning supplies.ElectricityMaintenanceRentWages and salaries.DepreciationAdministrative expenses$ 0.02For example, electricity costs should be $1,400 per month plus $0.08 per car washed. The company expects to wash 8,400 cars inAugust and to collect an average of $6.20 per car washed.The actual operating results for August are as follows:Lavage RapideIncome StatementFor the Month Ended August 31Actual cars washedRevenueExpenses:I Cleaning supplies.ElectricityMaintenanceWages and salariesDepreciationFixedCost per Cost perMonthCar Washed$0.60$1,400$ 0.08$4,600$ 8,300$ 2,100$1,500RentAdministrative expensesTotal expensesNet operating income8,500$ 54,100$ 0.15$ 0.205,5402,0421,5006,6408,3002,3001,56827,890$26,290Required:Calculate the company's revenue and spending variances for August.

Revenue and spending variance :— It is the difference between actual results and flexible budget.…

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 Rent Wages and salaries. Depreciation Administrative expenses $ 0.02 For example, electricity costs should be $1,400 per month plus $0.08 per car washed. The company expects to wash 8,400 cars i August and to collect an average of $6.20 per car washed. The actual operating results for August are as follows: Actual cars washed Revenue Lavage Rapide Income Statement For the Month Ended August 31 Expenses: I Cleaning supplies. Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Cost per Month Car Washed $1,400 $4,600 $ 8,300 $ 2,100 $1,500 Administrative expenses Total expenses Net operating income 8,500 $ 54,100 $0.60 0.08 5,540 2,042 1,500 6,640 8,300 2,300 1,568 27,890 $26,290 $ $ 0.15 $ 0.20 Required: Calculate the company's revenue and spending variances for August.

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 Rent Wages and salaries. Depreciation Administrative expenses $ 0.02 For example, electricity costs should be $1,400 per month plus $0.08 per car washed. The company expects to wash 8,400 cars i August and to collect an average of $6.20 per car washed. The actual operating results for August are as follows: Actual cars washed Revenue Lavage Rapide Income Statement For the Month Ended August 31 Expenses: I Cleaning supplies. Electricity Maintenance Wages and salaries Depreciation Rent Fixed Cost per Cost per Month Car Washed $1,400 $4,600 $ 8,300 $ 2,100 $1,500 Administrative expenses Total expenses Net operating income 8,500 $ 54,100 $0.60 0.08 5,540 2,042 1,500 6,640 8,300 2,300 1,568 27,890 $26,290 $ $ 0.15 $ 0.20 Required: Calculate the company's revenue and spending variances for August.

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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