Question
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 companys costs:
| Fixed Cost per Month | Cost per Car Washed |
Cleaning supplies |
| $ 0.60 |
Electricity | $ 1,300 | $ 0.06 |
Maintenance |
| $ 0.10 |
Wages and salaries | $ 4,200 | $ 0.30 |
Depreciation | $ 8,000 |
|
Rent | $ 1,900 |
|
Administrative expenses | $ 1,600 | $ 0.04 |
For example, electricity costs are $1,300 per month plus $0.06 per car washed. The company expects to wash 8,100 cars in August and to collect an average of $6.20 per car washed.
Required:
Prepare the companys planning budget for August.
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Lavage Rapide |
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Planning Budget |
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For the Month Ended August 31 |
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Revenue |
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Expenses: |
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Cleaning supplies |
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Electricity |
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Maintenance |
|
Wages and salaries |
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Depreciation |
|
Rent |
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Administrative expenses |
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Total expense |
|
Net operating income |
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