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 $ 1,800 Cleaning supplies Electricity Maintenance Hages and salaries Depreciation Rent Administrative expenses Cost per Car Washed $0.70 0.10 0.3e 0.40 5,100 3,700 2,500 2,240 0.09 For example, electricity costs are $1,800 per month plus $0.90 per car washed. The company expects to wash 8,000 cars in October and to collect an average of $6.30 per car washed, Auto Lavage's actual level of activity was 8,500 cars. The actual revenues and expenses for October are given below: Auto Luvage Income Statement For the Month Ended October 31 Actual cars washed 8,500 Sales $56,300 Variable expenses: Cleaning supplies Electricity Maintenance Wages and salaries Administrative Fixed expenses: Electricity Wages and salaries Deoreciation 6,475 910 2,075 3,802 856 1,890 5,100 8.700 For example, electricity costs are $1,800 per month plus $0.10 per car washed. The company expects to wash 8,400 cars in October and to collect an average of $6.30 per car washed. Auto Lavage's actual level of activity was 8,500 cars. The actual revenues and expenses for October are given below. Auto Lavage Income Statement For the Month Ended October 31 Actual cars washed 8,500 Sales $56,300 Variable expenses: Cleaning supplies Electricity Maintenance Wages and salaries Administrative Fixed expenses: Electricity Wages and salaries Depreciation Rent Administrative 6,475 910 2,075 3,802 856 1,890 5,100 8,700 2,500 2,145 Total expense 34,453 Net operating incom $21,847 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 (.e., zero variance).) RUTOL VAGE INC Flexible Budget Performance Repon For the Month Ended October 31 Cost Fomula Flexible Actual (per car) Budget Flexible Budget Variance Variable Expenses Total variable expenses 0.00 0 0 0 0 Fixed expenses 2. Prepare a comprehensive performance report for October. Assume that the static budget for October was based on an activity level of 8.400 cars. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (t.e., zero variance).) AUTO LAVAGE ING Comprehensive Performance Report For the Month Ended October 31 Actual Flexible Budget Variance Flexible Budget Sales Volume Varice Static Budget Number of cars 8,500 8,500 8,400 Variable Expenses Total variable expenses 0 0 0 0 0 0 Fixed expenses
