Auto Lavage is a Canadian company that owns and operates a large automatic carwa

Question

Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. the following table provides data concerning the company's costs: For example, electricity costs are $1, 300 per month plus $0. 05 per car washed. the company expects to wash 8, 100 cars in October and to collect an average of $6. 30 per car washed. the actual operating results for October appear below: Compute the company's revenue and spending variances for October. (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i. e. , zero variance). Omit the "$" sign in your response. )

Explanation / Answer

Expected Revenue is 8100 * 6.3 = 51030 and the actual favourable and variance is 53130 - 51030 = 2100

Expenses

Expected Cleaning supplies is 8100 * 0.6 = 4860 and hence is unfavourable by 5360 - 4860 = 500

Expected Electricity is 1300 + 0.05 * 8100 = 1705 and hence favourable by 1750 - 1675 = 75

Expected maintenance is 8100 * 0.25 = 2025 and hence is unfavourable by 2265 - 2025 = 240

Expected Wages is 4900 + 8100 * 0.3 = 7330 and hene is unfavourable by 7690 - 7330 = 360

Expected Depreciation is 8500 and actual is 8500, hence 0 and none

Expected Rent is 2000 and actual is 2200 and hence unfavourable by 200

Expected administrative = 1800 + 8100 * 0.01 = 1881 and hence favourable by 1881 - 1781 = 100

Expected total expense is 28301 and actual is 29471 and hence unfavourable by 1170

Expected Net Operating income is 22729 and actual is 23659 and hence is favourable by 930

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