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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
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 costs: Cost per Car Washed S0.60 S0.10 0.40 S0.60 Fixed Cost per Month Cleaning supplies Electricity Maintenance Wages and salaries $1,350 $3,900 $ 8,500 $ 3,400 $1,900 Rent Administrative expenses S0.05 For example, electricity costs are $1,350 per month plus $O.10 per car washed. The company expects to wash 8,500 cars in October and to collect an average of $7.00 per car washed. The company actually washed 8,700 cars in October The actual operating results for October appear below: Auto Lavage Income Statement For the Month Ended October 31 Actual cars washed Revenue 8,700 $ 62,250 Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses 5,610 2,165 3,730 9,430 8,500 3,700 2,190 Total expense 35,325 Net operating income $ 26,925
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