The following table provides data concerning a company’s costs: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.40 Electricity $ 1,400 $ 0.08 Maintenance $ 0.15 Wages and salaries $ 4,900 $ 0.30 Depreciation $ 8,400 Rent $ 1,800 Administrative expenses $ 1,400 $ 0.04 For example, electricity costs are $1,400 per month plus $0.08 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed. Prepare the company’s planning budget for August.
The following table provides data concerning a company’s costs: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.40 Electricity $ 1,400 $ 0.08 Maintenance $ 0.15 Wages and salaries $ 4,900 $ 0.30 Depreciation $ 8,400 Rent $ 1,800 Administrative expenses $ 1,400 $ 0.04 For example, electricity costs are $1,400 per month plus $0.08 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed. Prepare the company’s planning budget for August.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The following table provides data concerning a company’s costs:
| Fixed Cost per Month | Cost per Car Washed | |
|---|---|---|
| Cleaning supplies | $ 0.40 | |
| Electricity | $ 1,400 | $ 0.08 |
| Maintenance | $ 0.15 | |
| Wages and salaries | $ 4,900 | $ 0.30 |
| $ 8,400 | ||
| Rent | $ 1,800 | |
| Administrative expenses | $ 1,400 | $ 0.04 |
For example, electricity costs are $1,400 per month plus $0.08 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed.
Prepare the company’s planning budget for August.
| Budgeted Cars Washed | |
| Revenue | |
| Expenses: | |
| Cleaning Supplies | |
| Electricity | |
| Maintenance | |
| Wages and Salaries | |
| Depreciation | |
| Rent | |
| Administrative Expenses | |
| Total Expenses | |
| Net Operating Income | $ |
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