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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
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: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost per Month Cost per Car Washed $0.40 $1,100 $0.06 $0.20 $4,200 $0.40 $8,400 $2,000 $1,400 $0.05 For example, electricity costs are $1,100 per month plus $0.06 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.00 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 8,300 Revenue $51,300 Expenses: Cleaning supplies 3,780 Electricity 1,562 Maintenance 1,880 Wages and salaries 7,840 Depreciation 8,400 Rent 2,200 Administrative expenses 1,710 Total expense 27,372 Net operating income $23,928 Hel
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