Lavage Rapide is a Canadian company that owns and operates a large automatic car

Question

Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs Fixed Cost per Month Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Cost per Car Washed 0.50 $0.06 $0.15 $0.30 $1,100 $4,100 $8,100 $1,900 $1,600 $0.03 For example, electricity costs are $1,100 per month plus $0.06 per car washed. The company actually washed 8,500 cars in August and expects to collect an average of $6.80 per car washed

Explanation / Answer

LAVAGE RAPIDE FLEXIBLE BUDGET FOR THE MONTH ENDED AUGUST 31 Revenue (8500*$6.80) 57800 Expenses: Cleaning supplies (8500*$0.50) 4250 Electricity ($1100+8500*$0.06) 1610 Maintenance (8500*$0.15) 1275 Wages and salaries ($4100+8500*$0.30) 6650 Depreciation 8100 Rent 1900 Administrative expenses ($1600+8500*$0.03) 1855 Total expense 25640 Net operating Income 32160

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