Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning

image text in transcribed

Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,000 $ 0.09 $ 0.30 $ 4,200 $ 0.20 $ 8,400 $ 2,100 $ 1,500 $ 0.03 For example, electricity costs should be $1,000 per month plus $0.09 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.60 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income Required: 8,600 $ 58,200 6,450 1,735 2,790 6,260 8,400 2,300 1,655 29,590 $ 28,610 Calculate the company's revenue and spending variances for August. Note: Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values. Revenue Expenses: Lavage Rapide Revenue and Spending Variances For the Month Ended August 31 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles of Cost Accounting

Authors: Edward J. Vanderbeck, Maria Mitchell

17th edition

9781305480520, 1305087402, 130548052X, 978-1305087408

More Books

Students also viewed these Accounting questions

Question

Explain why needs motivate our behavior.

Answered: 1 week ago

Question

6. The salary of the president of the company is $200,000 per year.

Answered: 1 week ago