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 Cost per per Month Car Washed Cleaning supplies $0.80 Electricity $ 1,510 0.20 Maintenance 0.40 Wages and salaries 4,800 0.50 Depreciation 8,400 Rent 2,200 Administrative expenses 1,910 0.06 For example, electricity costs are $1,510 per month plus $0.20 per car washed. The company expects to wash 8,100 cars in October and to collect an average of $6.00 per car washed. Auto Lavage's actual level of activity was 8,200 cars. The actual revenues and expenses for October are given below: Auto Lavage Income Statement For the Month Ended October 31 Actual cars washed 8,200 Sales $53,300 7,250 1,690 2,780 4,205 586 Variable expenses Cleaning supplies Electricity Maintenance Wages and salaries Administrative Fixed expenses Electricity Wages and salaries Depreciation Rent Administrative 1,560 4,800 8,400 2,200 1,845 Total expense 35,316 Net operating income $17,984 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 (.e., zero variance).) AUTO LAVAGE INC. Flexible Budget Performance Report For the Month Ended October 31 Cost Formula Flexible Actual (per car) Budget OS 6.00 $ 53,300 $ 49,200 Flexible Budget Variance $ 4,100 Sales Variable Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Administrative 0.80 0.20 0.40 OOOOO 6,560 1,640 ololololo 7.250 1.690 2.780 4,205 586 Isola 3.280 690 U 50 U 500 F 105 IU 94U OOOOO OOOOO 0.50 4,100 492 0.06 1.96 16,511 36,789 16,072 33,128 x U XF OO 4.04 Total variable expenses Contribution margin Fixed expenses Electricity Wages and salaries Depreciation Rent Administrative OOOOO 1.560 4.800 8.400 2.200 1,845 ololololo 1,510 4.800 8.400 2,200 1,910 50 None 0 None 0 None 0 None 65 None None OOO Total fixed expenses 18,805 18,820 424 x U Operating income $ 17,984 $ 14,308 $ 3,676 F "Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; na points deducted. 2. Prepare a comprehensive performance report for October. Assume that the static budget for October was based on an activity level of 8,100 cars. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).) AUTO LAVAGE INC. Comprehensive Performance Report For the Month Ended October 31 Flexible Flexible Budget Actual Variance Budget 8.200 8,200 $ 53,300 $ 4,100FS 49,200 Sales Volume Variance Static Budget 8,100 $48,600 600 Number of cars Sales Variable Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Administrative ololololo 7.250 1,690 2.780 690U 50U 500 F 105 U 94 OOOO ololololo 6,560 1,640 3.280 4,100 492 80 U 20U 40 U 50 U lolololo OOOOO 6,480 1,620 3,240 4,050 ololololo 4,205 586 6 486 16,511 36.789 16,072 33,128 U F OS 15,876 32,724 Total variable expenses Contribution margin Fixed expenses: Electricity Wages and salaries Depreciation Rent Administrative oooo 1,560 4.800 8.400 2,200 1.845 50U 0 0 1,510 4,800 8,400 2,200 1.910 OOOO 0 None 0 None 0 None 0 None 0 None 00000 1,510 4,800 8.400 2,200 1.910 0 65F 196 Total fixed expenses Operating income 18,805 17.984 424 U 3,676 F 01 18,820 $ 14,308 O O 18,820 $13,904 s IS 404