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Exercise 9-11 Flexible Budget [LO9-1] Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following
Exercise 9-11 Flexible Budget [LO9-1]
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 companys costs:
Fixed Cost per Month | Cost per Car Washed | ||||
Cleaning supplies | $ | 0.70 | |||
Electricity | $ | 1,400 | $ | 0.07 | |
Maintenance | $ | 0.10 | |||
Wages and salaries | $ | 4,000 | $ | 0.30 | |
Depreciation | $ | 8,400 | |||
Rent | $ | 1,900 | |||
Administrative expenses | $ | 1,800 | $ | 0.04 | |
For example, electricity costs are $1,400 per month plus $0.07 per car washed. The company actually washed 8,200 cars in August and collected an average of $5.90 per car washed.
Required:
Prepare the companys flexible budget for August.
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