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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
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 Cost per Car Washed per Month cleaning supplies Electricity $0.40 $1,400 $0.08 $0.25 $0.30 Maintenance Wages and salaries Depreciation $4,400 $8,300 $1,800 $1,800 Rent Administrative expenses $0.02 For example, electricity costs are $1,400 per month plus $0.08 per car washed. The company expects to wash 8,300 cars in August and to collect an average of $6.60 per car washed. The actual operating results for August appear below. Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,400 $56,880 Revenue Expenses: Cleaning supplies Electricity 3,820 2,034 2,315 7,250 Maintenance Wages and salaries Depreciation 8,300 2,000 1,866 Rent Administrative expenses Total expense 27,585 $29,295 Net operating income 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
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