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 car wash facility near Montreal. The following table provides data concerning the company’s costs:

For example, electricity costs are $1,300 per month plus $0.08 per car washed. The company actually washed 8,100 cars in August and collected an average of $6.60 per car washed.

Fixed Cost
per Month Cost per
Car Washed Cleaning supplies $ 0.40 Electricity $ 1,300 $ 0.08 Maintenance $ 0.20 Wages and salaries $ 4,800 $ 0.30 Depreciation $ 8,300 Rent $ 2,100 Administrative expenses $ 1,700 $ 0.02 2 Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost per Month Cost per Car Washed $0.40 $ 0.08 0.20 0.30 points Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $1,300 $4,800 $8,300 $2,100 1,700 eBook $ 0.02 Hint For example, electricity costs are $1,300 per month plus $0.08 per car washed. The company actually washed 8,100 cars in August and collected an average of $6.60 per car washed. Print Required: Prepare the company's flexible budget for August. References Lavage Rapide Flexible Budget For the Month Ended August 31 Revenue Cleaning supplies Electricity Wages and salaries Depreciation Rent Total expense Net operating income

Explanation / Answer

Actual cars washed 8100 Revenue 53460 =8100*6.6 Expenses: Cleaning supplies 3240 =8100*0.4 Electricity 1948 =1300+(8100*0.08) Maintenance 1620 =8100*0.2 Wages and salaries 7230 =4800+(8100*0.3) Depreciation 8300 Rent 2100 Administrative expenses 1862 =1700+(8100*0.02) Total expenses 26300 Net operating income 27160

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