Lavage Rapide is a Canadian company that owns and operates a large automatic car

Question

Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal The foilowing table provides data concerning the company's costs: Foxod Cost Cost per per Month Car Washed 0.60 0.08 $0.25 $0.40 Cleaning supplies $1.400 Wages and salaries Depreciaion Ront $4,300 $8,300 $2,000 $0.03 For example, electricity costs are $1,400 per month plus $0.08 per car washed. The company expected to wash 8,100 cars in August and to colect an average of $6.60 per car washed The actual operating results for August appear below Inoomo Statemont For the Month Ended August 31 Actual cars washed 8.200 $55.560 5.360 2018 2 265 7.900 8 300 2 200 1443 Cleaning aupplios Electricity Wages and salaries Deprediation Rent Administraive expenses Total expense 29.486 Net operating income 26,074 Computo the company's rovenue and spending variances for August. (Indicate the offect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no offect (Lo., zero variance). Input all amounts as positive values.) Revenue and Spending Variances For the Month Ended August 31 Revenu Cleaning supplies wagas and Total expense ncome

Explanation / Answer

Actual results Flexible budget Revenue and spending variances Revenue 55560 54120 1440 F Expenses: Cleaning supplies 5360 4920 440 U Electricity 2018 2056 38 F Maintenance 2265 2050 215 U Wages and salaries 7900 7580 320 U Depreciation 8300 8300 0 None Rent 2200 2000 200 U Administrative expenses 1443 1546 103 F Total expenses 29486 28452 1034 U Net operating income 26074 25668 406 F

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