Check my work Lavage Rapide is a Canadian company that owns and operates a large
ID: 2591373 • Letter: C
Question
Check my work 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: Fixed Cost per Month Car Wash Cost per Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses $0.60 $0.07 $0.25 $0.30 $1,200 $4,300 $8,200 $2,000 $1,400 $0.05 For example, electricity costs are $1,200 per month plus $O07 per car washed. The company expects to wash 8.200 cars in August and to collect an average of $6.00 per car washed. The actual operating results for August appear below Lavage Rapide tncome Statenent For the Month Ended August 31 8,300 Actual ears vashed Revenue Expenses 551-300 Cleaning supplies Electrieity Maintenanee Hages and salaries Depreciation Rent Adminiatrative expenses 5,420 1,744 2, 290 7, 120 8,200 2,200 1,710Explanation / Answer
Revenue and Spending Variance is as prepared below:
Lavage Rapide Activity variances For the Month Ended August 31 Planning Budget Flexible Budget Activity variances (Flexible-Planning) Car Wash (a) 8,200 8,300 100 Revenue (6*a) 49,200 49,800 600 F Expenses: Cleaning Supplies (0.60a) 4,920 4,980 60 U Electricity (1,200+ .07a) 1,774 1,781 7 U Maintenance (.25a) 2,050 2,075 25 U Wages and salaries (4,300+.30a) 6,760 6,790 30 U Depreciation (8,200) 8,200 8,200 0 None Rent (2,000) 2,000 2,000 0 None Administrative expenses (1,400+.05a) 1,810 1,815 5 U Total expenses 27,514 27,641 127 U Net operating income 21,686 22,159 473 F