CHAP 9 ALG 1

Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,300 pounds of oysters in August. The company's flexible budget for August appears below: Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (9) 7,300 $ 30,660 Revenue ($4.209) Expenses: Packing supplies ($0.309) Oyster bed maintenance ($3,400) Wages and salaries ($2,400 + $0.309) Shipping ($0.759) Utilities ($1,240) Other ($490 + $0.019) Total expense Net operating income 2,190 3,400 4,590 5,475 1,240 563 17,458 $ 13,202 The actual results for August appear below: Quilcene Oysteria Income Statement For the Month Ended August 31 Actual pounds 7,300 $ 26,500 Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income 2,360 3,260 5,000 5,205 1,050 1,183 18,058 8,442 $ Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Quilcene Oysteria Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost per Month $1,200 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Cost per Car Washed $0.60 $ 0.08 $ 0.20 $ 0.20 $4,200 $8,200 $1,900 $1,400 $ 0.02 For example, electricity costs are $1,200 per month plus $0.08 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.70 per car washed. The actual operating results for August appear below. Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,100 $ 55,700 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income 5,300 1,810 1,840 6,160 8,200 2,100 1,460 26,870 $ 28,830 Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Lavage Rapide Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income