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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 estimates concerning the company’s costs:
Fixed cost per month Cost per car washed
Cleaning supplies $0.40
Electricity $1,200 $0.08
Maintaince $0.25
Wages and salaries $4,000 $0.30
Rent $1,900
Administrative expenses $1,500 $0.03
For example, electricity costs should be $1,200 per month plus $0.08 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.00 per car washed.
The actual operating results for August are as follows:
Actual cars washed 8,600
Revenue $53,100
Expenses:
Cleaning supplies 3,900
Electricity 1,850
Maintaince 2,365
Wages and salaries 6,910
Depreciation 8,000
Rent 2,100
Administrative expenses 1,665
Total expenses $26,780
Net operating income $26,320
Calculate the company's revenue and spending variances for August.
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- Required information [The following information applies to the questions displayed below.] Listed here are the costs associated with the production of 1,000 drum sets manufactured by TrueBeat. Costs 1. Plastic for casing-$17,000 2. Wages of assembly workers-$82,000 3. Property taxes on factory-$5,000 4. Office accounting salaries-$35,000 5. Drum stands-$26,000 6. Rent cost of office for accountants- $10,000 7. Office management salaries-$125,000 8. Annual fee for factory maintenance- $10,000 9. Sales commissions-$15,000 10. Factory machinery depreciation, straight-line-$40,000 Required: 1. Classify each cost and its amount as either product or period. The first cost is completed as an example. Costs 1. Plastic for casing 2. Wages of assembly workers 3. Property taxes on factory 4. Office accounting salaries 5. Drum stands 6. Rent cost of office for accountants 7. Office management salaries 8. Annual fee for factory maintenance 9. Sales commissions 10. Factory machinery depreciation,…arrow_forwardLavage Rapide owns and operates a large automatic car wash facility near Montreal. The following table provides estimates concerning the company's costs: Fixed Cost per Month Cost per Car Washed Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $ 0.50 $ 0.06 $ 1,100 $ 0.15 $ 5,000 $ 0.30 $ 8,200 $1,900 $ 1,400 $ 0.05 For example, electricity costs should be $1,100 per month plus $0.06 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.80 per car washed. The company actually washed 8,600 cars in August. Required: Calculate the company's activity variances for August. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero variance). Input all amounts as positive values. Revenue Lavage Rapide Activity Variances For the Month Ended August 31 $ 58,480 None Expenses: Cleaning supplies 4,300 F Electricity 1,616 F…arrow_forwardll.2arrow_forward
- 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: Fixed Costper Month Cost perCar Washed Cleaning supplies $ 0.80 Electricity $ 1,200 $ 0.15 Maintenance $ 0.20 Wages and salaries $ 5,000 $ 0.30 Depreciation $ 6,000 Rent $ 8,000 Administrative expenses $ 4,000 $ 0.10 For example, electricity costs should be $1,200 per month plus $0.15 per car washed. The company actually washed 8,800 cars in August and collected an average of $4.90 per car washed. Required: Prepare the company’s flexible budget for August.arrow_forwardBoth images are the same continuing question. Please helparrow_forwardLavage 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: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.70 Electricity $ 1,100 $ 0.10 Maintenance $ 0.15 Wages and salaries $ 4,400 $ 0.30 Depreciation $ 8,100 Rent $ 2,100 Administrative expenses $ 1,300 $ 0.04 For example, electricity costs are $1,100 per month plus $0.10 per car washed. The company actually washed 8,500 cars in August and collected an average of $6.60 per car washed. Required: Prepare the company’s flexible budget for August.arrow_forward
- Calculate the product costs.arrow_forwardLavage 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: Fixed Cost per Month $ 1,300 $ 4,100 $ 8,400 $ 2,000 Administrative expenses $ 1,700 $ 0.05 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent For example, electricity costs are $1,300 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.30 per car washed. Required: Prepare the company's planning budget for August. Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Cost per Car Washed $0.60 $ 0.06 $ 0.15 $0.30 Administrative expenses Total expense Net operating income $ 0 0arrow_forwardLavage 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: Fixed Costper Month Cost perCar Washed Cleaning supplies $ 0.80 Electricity $ 1,100 $ 0.05 Maintenance $ 0.30 Wages and salaries $ 4,800 $ 0.20 Depreciation $ 8,200 Rent $ 1,900 Administrative expenses $ 1,700 $ 0.03 For example, electricity costs are $1,100 per month plus $0.05 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.50 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 8,500 Revenue $ 56,700 Expenses: Cleaning supplies 7,220 Electricity 1,490 Maintenance 2,760 Wages and salaries 6,840 Depreciation 8,200 Rent 2,100 Administrative…arrow_forward
- 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: Fixed Cost per Month Cost per Car Washed Cleaning supplies $ 0.40 Electricity $ 1,200 $ 0.07 Maintenance $ 0.15 Wages and salaries $ 4,100 $ 0.20 Depreciation $ 8,300 Rent $ 1,900 Administrative expenses $ 1,500 $ 0.02 For example, electricity costs should be $1,200 per month plus $0.07 per car washed. The company actually washed 8,500 cars in August and collected an average of $6.90 per car washed. Required: Prepare the company’s flexible budget for August.arrow_forwardLavage 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 Costper Month Cost perCar Washed Cleaning supplies $ 0.70 Electricity $ 1,300 $ 0.07 Maintenance $ 0.20 Wages and salaries $ 4,500 $ 0.40 Depreciation $ 8,100 Rent $ 2,000 Administrative expenses $ 1,400 $ 0.05 For example, electricity costs should be $1,300 per month plus $0.07 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.10 per car washed. Required: Prepare the company’s planning budget for August.arrow_forwardHanshabenarrow_forward
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