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 expected costs. Fixed Cost per month Cost per Car Washed 50.se 2.2 0.40 $ 2,150 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses 0.5e 5,480 9,000 2,800 2,520 0.05 For example, electricity costs are $2.150 per month plus $0.20 per car washed. The company expects to wash 8700 cars in October and to collect an average of $6.60 per car washed Auto Lavage's actual level of activity was 8,800 cars. The actual revenues and expenses for October are given below: Auto Lavage Income Statement For the Month Ended October 31 Actual cars wasted 8,300 Sales $60,300 Variable expenses: Cleaning supplies Electricity Haintenance 7.540 1,620 2.990 Auto Lavage's actual level of activity was 8,800 cars. The actual revenues and expenses for October are given below Auto Lavage Income Statement For the Month Ended October 31 Actual cars washed 8,800 Sales $60,300 7,640 1,820 2.990 4.760 520 es Variable expenses Cleaning supplies Electricity Maintenance Wages and salaries Administrative Fixed expenses: Electricity Wages and salaries Depreciation Rent Administrative 2,220 5,400 9,000 2,800 2.445 Total expense 39,595 Net operating Income 520,705 Required: 1. Prepare a flexible budget performance report for October (Indicate the effect of each variance by selecting "F" for favourable. "U" for unfavourable, and "None" for no effect (ie, zero variance).) AUTO LAVAGE INC. Flexible Budget Performance Report For the Month Ended October 31 Cost Formula Flexible Act Budget (per car) $ 660 $ 58 080 Flexible Variance Sales Variable Expenses Cleaning supplies Electricity Maintenance Wages and salaries Administrativo 0 80 0.20 0.40 0.50 0.05 1.95 4.65 0 58.00 58.080 Total variable expenses Contribution margin Fixed expenses 0.80 Variable Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Administrative 0.20 0.40 0.50 0.05 0 1.95 4.65 58,080 58,080 Total variable expenses Contribution margin Fixed expenses Electricity Wages and salaries Depreciation Rent Administrative 0 Total fixed expenses Operating income 0 58,080 5 58,080 Check my went 2. Prepare a comprehensive performance report for October Assume that the static budget for October was based on an activity level of 8.700 cars (Indicate the effect of each variance by selecting "P" for favourable. "U" for unfovourable, and "Mone" for no effect (i.e., zero variance).) AUTO LAVAGE INC Comprehensive Perfomance Report For the Month Ended October 31 Actual Flexible Budget Exible Variance Budget 8.800 8.800 Sales Volume Variance State Budget 3,700 Number of cars Variable Expenses Total variable expenses Total variable expenses 0 0 0 0 0 0 Fixed expenses 0 0 Total fixed expenses 0 $ 0 $ $ 0
