Question

Fixed Cost per Month $1,400 Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Cost per Car Washed $9.68 $e.86 $0.25 $8.4e $4, Bee $8.1ee $2.899 $1,300 $0.02 For example, electricity costs are $1.400 per month plus $0.06 per car washed. The company expects to wash 8.500 cars in August and to collect an average of $6.30 per car washed. The actual operating results for August appear below. Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,680 $ 55, 650 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income 5,689 1.888 2,365 7,760 8,100 2.280 1.378 29,275 $ 26,375 Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.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

	Actual	Revenue and spending variances		Flexible budget
Cars washed	8600			8600
Revenue	55650	1470	F	54180
Expenses:
Cleaning supplies	5600	440	U	5160
Electricity	1880	36	F	1916
Maintenance	2365	215	U	2150
Wages and salaries	7760	320	U	7440
Depreciation	8100	0	None	8100
Rent	2200	200	U	2000
Administrative expenses	1370	102	F	1472
Total expenses	29275	1037	U	28238
Net operating income	26375	433	F	25942