Question

Refer to the data for Auto Lavage in Exercises 9–9 and 9–11.
In Exercise 9–9, Auto Lavage is a Canadian company that owns and operates a large automatic carwash facility near Quebec. The following table provides data concerning the company’s costs:


For example, electricity costs are $1,400 per month plus $0.10 per car washed. The company expects to wash 8,000 cars in October and to collect an average of $5.90 per car washed.
In Exercise 9–11, Refer to the data for Auto Lavage. The actual operating results for October appear below:
Auto Lavage
Income Statement
For the Month Ended October 31
Actual cars washed . . . . . . . . . . . . . . . 8,100
Revenue . . . . . . . . . . . . . . . . . . . . . . . $49,300
Expenses:
Cleaning supplies . . . . . . . . . . . . . . 6,100
Electricity . . . . . . . . . . . . . . . . . . . . 2,170
Maintenance . . . . . . . . . . . . . . . . . . 2,640
Wages and salaries. . . . . . . . . . . . . 8,260
Depreciation . . . . . . . . . . . . . . . . . . 8,300
Rent . . . . . . . . . . . . . . . . . . . . . . . . 2,300
Administrative expenses . . . . . . . . . 2,100
Total expense . . . . . . . . . . . . . . . . . . . 31,870
Net operating income . . . . . . . . . . . . . $17,430

Required:
Prepare a report showing the company’s revenue and spending variances for October.


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  • CreatedSeptember 27, 2013
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