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:

  

For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expected to wash 9,000 cars in August and to collect an average of $4.90 per car washed.

  

  

   

Complete the flexible budget performance report that shows the company’s activity variances and revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

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:

Explanation / Answer

Working Notes:-

Lavage Rapide Planning Budget Fo rth emonth Ending August 31 Revenue(1) 44,100 Expenses: Cleaning Supplies 7,200 Electricity 2,550 Maintenance 1,800 Wage and Salaries 5,700 Depreciation 6,000 Rent 8,000 Administrative Expenses 4,900 Total Expenses(2) 36,150 Net operating incom(1-2) 7,950

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