Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following tableprovides estimates concerning the company's costs:Cleaning suppliesElectricityMaintenanceWages and salariesDepreciationAdministrative expensesRentActual cars washed.For example, electricity costs should be $1,300 per month plus $0.09 per car washed. The company expects to wash 8,000 carsAugust and to collect an average of $6.90 per car washed.The actual operating results for August are as follows:Lavage RapideIncome StatementFor the Month Ended August 31RevenueExpenses:Cleaning suppliesElectricityMaintenanceWages and salariesDepreciationRentFixed Cost Cost per Carper MonthWashed$ 1,300$4,100$ 8,000$ 1,800$ 1,700Administrative expensesTotal expenseNet operating income8,100$ 57,300$ 0.80$ 0.09$0.20$ 0.306,9001,9901,8406,8608,0002,0001,84029,430$ 27,870$ 0.03 Required:Prepare a flexible budget performance report that shows the company's revenue and spending variances and activity variances forAugust.Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zerovariance). Input all amounts as positive values.Cars washedRevenueExpenses:Cleaning suppliesElectricityMaintenanceWages and salariesDepreciationRentAdministrative expensesTotal expenseNet operating incomeLavage RapideFlexible Budget Performance ReportFor the Month Ended August 31$ActualResults8,100$ 57,3006,9001,9901,8406,8608,0002,0001,84029,43027,870FlexibleBudgetPlanningBudget

A flexible budget is a budget that includes all the flexibility and change in the output. In…

Required: 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 variance). Input all amounts as positive values. Cars washed Revenue Expenses: Cleaning supplies Lavage Rapide Flexible Budget Performance Report For the Month Ended August 31 Actual Results 8,100 S 57,300 6,900 Flexible Budget Planning Budget

Required: 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 variance). Input all amounts as positive values. Cars washed Revenue Expenses: Cleaning supplies Lavage Rapide Flexible Budget Performance Report For the Month Ended August 31 Actual Results 8,100 S 57,300 6,900 Flexible Budget Planning Budget

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 4EA: Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on...

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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: For example, electricity costs should be $1,200 per month plus $0.15 per car washed. The company expects to wash 9,000 cars in August and to collect an average of $4.90 per car washed. The company actually washed 8,800 cars in August. Required: Calculate the company's activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Dog 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 MonthCost per Car WashedCleaning supplies $ 0.80Electricity$ 1,200$ 0.15Maintenance $ 0.20Wages and salaries$ 5,000$ 0.30Depreciation$ 6,000 Rent$ 8,000 Administrative expenses$ 4,000$ 0.10For example, electricity costs should be $1,200 per month plus $0.15 per car washed. The company expects to wash 9,000 cars in August and to collect an average of $4.90 per car washed. The company actually washed 8,800 cars in August. Required: Calculate the company's activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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 Rent Wages and salaries Depreciation Administrative expenses For example, electricity costs are $1,400 per month plus $0.06 per car washed. The company actually washed 8,200 cars in August and collected an average of $6.60 per car washed. Lavage Rapide Flexible Budget For the Month Ended August 31 Revenue Expenses: Required: Prepare the company's flexible budget for August. Cleaning supplies Electricity Maintenance Fixed Cost per Month $ 1,400 Wages and salaries Depreciation Rent Cost per Car Washed $ 0.60 $ 0.06 $ 0.25 $ 0.20 $ 4,700 $ 8,500 $ 1,900 $ 1,300 $ 0.05 с
King's Appliance Shop operates retail stores that sell appliances. The cost objects are the individual sales of a given type of appliance and sales support. In July, the following costs were recorded for refrigerators: Professional sales staff commissions Amortization on office space Selling supplies Office staff expenses Customer relations Training expenses Utilities $84,000 4,000 6,400 24,800 8,600 6,000 1,400 Required: a. Which of the costs will be subject to direct cost tracing? b. What is the total cost for refrigerators? c. What is the total cost of the Sales Support for refrigerators?
Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)
Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)
Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Required: 1. Calculate the prime cost per cleaning. 2. Calculate the conversion cost per cleaning. 3. Calculate the total variable cost per cleaning. 4. Calculate the total service cost per cleaning. 5. What if rent on the office that Jean and Tom use to run HHH increased by 1,500? Explain the impact on the following: a. Prime cost per cleaning b. Conversion cost per cleaning c. Total variable cost per cleaning d. Total service cost per cleaning
Schneider Logistics Company has built a new warehouse in Columbus, Ohio, to facilitate the consoli-dation of freight shipments to customers in the region. George Schneider must determine how manyteams of dock workers he should hire to handle the cross-docking operations and the other warehouseactivities. Each team costs $5,000 a week in wages and overhead. Extra capacity can be subcontracted ata cost of $8,000 a team per week. Each team, whether in-house or subcontracted, can satisfy 200 laborhours of work a week. The labor hour requirements for the new facility are uncertain. Management hasestimated the following probabilities for the requirements: How many teams should Schneider hire?
Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. A. Wood used to produce desks ($125.00 per desk) B. Production labor used to produce desks ($15 per hour) C. Production supervisor salary ($45,000 per year) D. Depreciation on factory equipment ($60,000 per year) E. Selling and administrative expenses ($45,000 per year) F. Rent on corporate office ($44,000 per year) G. Nails, glue, and other materials required to produce desks (varies per desk) H. Utilities expenses for production facility I. Sales staff commission (5% of gross sales)
Ethan Manufacturing Incorporated produces floor mats for automobiles. The owner, Joseph Ethan, has asked you to assist in estimating maintenance costs. Together, you and Joseph determine that the single best cost driver for maintenance costs is machine hours. These data are from the previous fiscal year for maintenance costs and machine hours: Month Maintenance Costs Machine Hours 1 $ 2,780 1,870 2 2,940 1,950 3 3,090 2,030 4 3,200 2,050 5 3,280 2,080 6 3,250 2,060 7 3,190 2,040 8 3,030 2,020 9 2,800 1,880 10 2,400 1,280 11 2,410 1,480 12 2,630 1,770 Required: 1. What is the cost equation for maintenance costs using the high-low method? 2. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1.
Arctic Air Inc. manufactures cooling units for commercial buildings. The price and cost of goods sold for each unit are as follows: Category Per Unit Dollar Amount Price $60,000 Cost of goods sold Gross profit 28,000 32,000 In addition, the company incurs selling and administrative expenses of $226,250. The company wishes to assign these costs to its three major customers, Gough Industries, Breen Inc., and The Martin Group. These expenses are related to three major nonmanufacturing activities: customer service, project bidding, and engineering support. The engineering support is in the form of engineering changes that are placed by the customer to change the design of a product. The budgeted activity costs and activity bases associated with these activities are: Budgeted Activity Cost Activity Base $51,500 Number of service requests Activity Customer service Project bidding Engineering support 64,000 Number of bids 110,500 Number of customer design changes Total costs 226,000…
JPAK manufactures and sells mountain bikes. It operates eight hours a day, five days a week. Using this information,classify each of the following costs as fixed or variable with respect to the number of bikes made. Taxes on property