Question

Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company’s costs:

Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Fixed Cost Cost per per Month Car Washed Cleaning supplies 0.50 Electricity 1,000 0.05 Maintenance 0.20 Wages and salaries 4,100 0.40 Depreciation 8,200 Rent 2,200 Administrative expenses 1,400 0.03 For example, electricity costs are $1,000 per month plus $0.05 per car washed. The company expected to wash 8,300 cars in August and to collect an average of $6.80 per car washed. The actual operating results for August appear below. Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,400 58,540 Revenue Expenses Cleaning supplies 4,650 Electricity 1,385 Maintenance 1.900 Wages and salaries 7,780 Depreciation 8.200 Rent 2.400 Administrative expenses 1.549 Total expense 27,864 Net operating income 30,676 Required: Compute the company's revenue and spending 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 Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income

Answer 1