-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 Administrative expenses Rent Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses Fixed Cost per Month $ 0.01 For example, electricity costs should be $1,300 per month plus $0.06 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.20 per car washed. Cleaning supplies Electricity Maintenance Required: Prepare the company's planning budget for August. Wages and salaries Depreciation Rent $ 1,300 Administrative expenses Total expense Net operating income $4,700 $ 8,400 $ 2,200 $ 1,600 cost per Car Washed $0.80 $ 0.06 $ 0.20 $ 0.20 4
-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 Administrative expenses Rent Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses Fixed Cost per Month $ 0.01 For example, electricity costs should be $1,300 per month plus $0.06 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.20 per car washed. Cleaning supplies Electricity Maintenance Required: Prepare the company's planning budget for August. Wages and salaries Depreciation Rent $ 1,300 Administrative expenses Total expense Net operating income $4,700 $ 8,400 $ 2,200 $ 1,600 cost per Car Washed $0.80 $ 0.06 $ 0.20 $ 0.20 4
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
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Transcribed Image Text: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
Rent
Wages and salaries
Depreciation
Administrative expenses
For example, electricity costs should be $1,300 per month plus $0.06 per car washed. The company expects to wash
8,000 cars in August and to collect an average of $6.20 per car washed.
Revenue
Expenses:
Lavage Rapide
Planning Budget
For the Month Ended August 31
Cleaning supplies
Electricity
Maintenance
Fixed Cost
per Month
$ 1,300
Required:
Prepare the company's planning budget for August.
Wages and salaries
Depreciation
Rent
$4,700
$ 8,400
$ 2,200
$ 1,600
Administrative expenses
Total expense
Net operating income
Cost per
Car Washed
$ 0.80
$ 0.06
$ 0.20
$ 0.20
$ 0.01
4
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