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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
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![Exercise 9-13 (Algo) Prepare a Flexible Budget Performance Report [LO9-4]
Lovage 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:
Fixed Cost
Cost per
per Month Car Washed
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Administrative expenses
$ 0.50
$ 1,200
$ 0.10
$ 0,25
$ 4,800
$ 0.40
$ 8,400
$ 2,100
$ 1,800
$ 0.02
For example, electricity costs should be $1,200 per month plus $0.10 per car washed. The company expects to wash 8,300 cars in
August and to collect an average of $6.40 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:
8,400
$ 55,220
4,650
2,000
2,315
8,480
8,400
2,300
1.866
30.011
$ 25,209
Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for
August.
Note: Indicate the effect of each variance by selecting "F" for favorable. "U" for unfavorable, and "None" for no effect (I.e., zero
varlance). Input all amounts as positive values.
Lavage Rapide
Flexible Budget Performance Report
For the Month Ended August 31
Cars washed
Revenue
Actual
Results
8,400
$
55.220
Expenses
Cleaning supplies
4,650
Electricity
2.000
Maintenance
2.315
Wages and salaries
8,480
Depreciation
8,400
Rent
2.300
Administrative expenses
1,866
Total expense
30.011
Net operating income
$
25,209
Flexible
Budget
Planning
Budget
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Transcribed Image Text:Exercise 9-13 (Algo) Prepare a Flexible Budget Performance Report [LO9-4]
Lovage 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:
Fixed Cost
Cost per
per Month Car Washed
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Administrative expenses
$ 0.50
$ 1,200
$ 0.10
$ 0,25
$ 4,800
$ 0.40
$ 8,400
$ 2,100
$ 1,800
$ 0.02
For example, electricity costs should be $1,200 per month plus $0.10 per car washed. The company expects to wash 8,300 cars in
August and to collect an average of $6.40 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:
8,400
$ 55,220
4,650
2,000
2,315
8,480
8,400
2,300
1.866
30.011
$ 25,209
Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances for
August.
Note: Indicate the effect of each variance by selecting "F" for favorable. "U" for unfavorable, and "None" for no effect (I.e., zero
varlance). Input all amounts as positive values.
Lavage Rapide
Flexible Budget Performance Report
For the Month Ended August 31
Cars washed
Revenue
Actual
Results
8,400
$
55.220
Expenses
Cleaning supplies
4,650
Electricity
2.000
Maintenance
2.315
Wages and salaries
8,480
Depreciation
8,400
Rent
2.300
Administrative expenses
1,866
Total expense
30.011
Net operating income
$
25,209
Flexible
Budget
Planning
Budget
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