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: Cost per Fixed Cost Ca per Month $0.70 50.09 Cleaning supplies Maintenance Wages and salaries $4,600 Rent $0 $0.15 $0.40 $1,500 $8.100 $2.100 $1,400 $0.04 For example, electricity costs are $1,500 per month plus $0.09 per car washed. The company expected to wash 8,100 cars in August and to collect an average of $8.30 per car washed. The company actually washed 8,200 cars. The actual operating results for August appear below Lavage Rapide Income Statement For the Month Ended August 31 8.200 Actual cars washed Revenue $53,130 Cleaning supplies 6,170 2.199 1.455 8.200 8,100 2.300 Wages and salaries Rent 1,624 048 Net operating income $23,082 Total expense Compute the company's activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (e, zero variance). Input all amounts as positive values.) Activity Variances For the Month Ended t 31 Revenue Electricty Maintenance Wages and Rent Total expense Net operating ncome

Explanation / Answer

Planning budget Activity variances Flexible budget Revenue 51030 630 F 51660 Expenses: Cleaning supplies 5670 70 U 5740 Electricity 2229 9 U 2238 Maintenance 1215 15 U 1230 Wages and salaries 7840 40 U 7880 Depreciation 8100 0 None 8100 Rent 2100 0 None 2100 Administrative expenses 1724 4 U 1728 Total expenses 28878 138 U 29016 Net operating income 22152 492 U 22644

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