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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 Cost per Car per Month Washed Cleaning supplies Electricity Maintenance $ 0. 60 $ 0.08 $ 0. 25 $ 0. 20 $ 1,300 $ 4,400 $ 8,100 $ 1,900 $ 1,600 Wages and salaries Depreciation Rent Administrative expenses $ 0.03 For example, electricity costs should be $1,300 per month plus $0.08 per car washed. The company expects to wash 8,100 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 8,200 $ 54,750 Revenue Expenses: cleaning supplies Electricity Maintenance 5,360 1,918 2,265 Wages and salaries Depreciation Rent 6,380 8,100 2,100 1,743 27,866 Administrative expenses Total expense Net operating income $ 26,884 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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 estimates concerning the company's costs: Fixed Cost Cost per Car per Month Washed Cleaning supplies Electricity Maintenance $ 0. 60 $ 0.08 $ 0. 25 $ 0. 20 $ 1,300 $ 4,400 $ 8,100 $ 1,900 $ 1,600 Wages and salaries Depreciation Rent Administrative expenses $ 0.03 For example, electricity costs should be $1,300 per month plus $0.08 per car washed. The company expects to wash 8,100 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 8,200 $ 54,750 Revenue Expenses: cleaning supplies Electricity Maintenance 5,360 1,918 2,265 Wages and salaries Depreciation Rent 6,380 8,100 2,100 1,743 27,866 Administrative expenses Total expense Net operating income $ 26,884 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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.)

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter2: Building Blocks Of Managerial Accounting
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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 Cost per Car per Month Washed Cleaning supplies Electricity $ 0. 60 $ 0. 08 $ 0. 25 $ 0. 20 $ 1,300 Maintenance Wages and salaries Depreciation $ 4,400 $ 8,100 $ 1,900 $ 1,600 Rent Administrative expenses $ 0.03 For example, electricity costs should be $1,300 per month plus $0.08 per car washed. The company expects to wash 8,100 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 8,200 Revenue $ 54,750 Expenses: Cleaning supplies Electricity 5,360 1,918 2,265 6,380 8,100 2,100 Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense 1,743 27,866 $ 26,884 Net operating income Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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.)
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: Fixed Cost Cost per Car per Month Washed Cleaning supplies Electricity $ 0. 60 $ 0. 08 $ 0. 25 $ 0. 20 $ 1,300 Maintenance Wages and salaries Depreciation $ 4,400 $ 8,100 $ 1,900 $ 1,600 Rent Administrative expenses $ 0.03 For example, electricity costs should be $1,300 per month plus $0.08 per car washed. The company expects to wash 8,100 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 8,200 Revenue $ 54,750 Expenses: Cleaning supplies Electricity 5,360 1,918 2,265 6,380 8,100 2,100 Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense 1,743 27,866 $ 26,884 Net operating income Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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 Income Statement For the Month Ended August 31 Actual cars washed 8,200 Revenue $ 54,750 Expenses: Cleaning supplies Electricity 5,360 1,918 2,265 6,380 8,100 2,100 1,743 Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense 27,866 Net operating income $ 26,884 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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 Flexible Budget Performance Report For the Month Ended August 31 Actual Results Flexible Planning Budget Budget Cars washed 8,200 Revenue $ 54,750 Expenses: Cleaning supplies 5,360 Electricity 1,918 Maintenance 2,265 Wages and salaries 6,380 Depreciation 8,100 Rent 2,100 Administrative expenses 1,743 Total expense 27,866 Net operating income $ 26,884
Transcribed Image Text:Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,200 Revenue $ 54,750 Expenses: Cleaning supplies Electricity 5,360 1,918 2,265 6,380 8,100 2,100 1,743 Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense 27,866 Net operating income $ 26,884 Required: Prepare a flexible budget performance report that shows the company's revenue and spending variances and 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 Flexible Budget Performance Report For the Month Ended August 31 Actual Results Flexible Planning Budget Budget Cars washed 8,200 Revenue $ 54,750 Expenses: Cleaning supplies 5,360 Electricity 1,918 Maintenance 2,265 Wages and salaries 6,380 Depreciation 8,100 Rent 2,100 Administrative expenses 1,743 Total expense 27,866 Net operating income $ 26,884
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