Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table provides data concerning the companys expected costs:

Fixed Cost

per Month Cost per

Car Washed

Cleaning supplies $ 0.90

Electricity $ 1,600 0.30

Maintenance 0.50

Wages and salaries 4,900 0.60

Depreciation 8,500

Rent 2,300

Administrative expenses 2,020 0.07

For example, electricity costs are $1,600 per month plus $0.30 per car washed. The company expects to wash 8,200 cars in October and to collect an average of $6.10 per car washed.

Auto Lavages actual level of activity was 8,300 cars. The actual revenues and expenses for October are given below:

Auto Lavage

Income Statement

For the Month Ended October 31

Actual cars washed 8,300

Sales $ 54,300

Variable expenses:

Cleaning supplies 7,800

Electricity 2,560

Maintenance 3,640

Wages and salaries 5,250

Administrative 656

Fixed expenses:

Electricity 1,670

Wages and salaries 4,900

Depreciation 8,500

Rent 2,300

Administrative 1,945

Total expense 39,221

Net operating income $ 15,079

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 (i.e., zero variance).)

2. Prepare a comprehensive performance report for October. Assume that the static budget for October was based on an activity level of 8,200 cars. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).)