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 per Month Cost per Car Washed Cleaning supplies $ 0.40 Electricity $ 1,000 $ 0.06 Maintenance $ 0.20 Wages and salaries $ 4,200 $ 0.30 Depreciation $ 8,300 Rent $ 2,200 Administrative expenses $ 1,500 $ 0.04 For example, electricity costs should be $1,000 per month plus $0.06 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.00 per car washed. Required: Prepare the company’s planning budget for August.
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 per Month Cost per Car Washed Cleaning supplies $ 0.40 Electricity $ 1,000 $ 0.06 Maintenance $ 0.20 Wages and salaries $ 4,200 $ 0.30 Depreciation $ 8,300 Rent $ 2,200 Administrative expenses $ 1,500 $ 0.04 For example, electricity costs should be $1,000 per month plus $0.06 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.00 per car washed. Required: Prepare the company’s planning budget for August.
Chapter7: Budgeting
Section: Chapter Questions
Problem 3PA: Echo Amplifiers prepared the following sales budget for the first quarter of 2018: It also has this...
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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 per Month | Cost per Car Washed | |
|---|---|---|
| Cleaning supplies | $ 0.40 | |
| Electricity | $ 1,000 | $ 0.06 |
| Maintenance | $ 0.20 | |
| Wages and salaries | $ 4,200 | $ 0.30 |
| $ 8,300 | ||
| Rent | $ 2,200 | |
| Administrative expenses | $ 1,500 | $ 0.04 |
For example, electricity costs should be $1,000 per month plus $0.06 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.00 per car washed.
Required:
Prepare the company’s planning budget for August.
Transcribed Image Text:Lavage Rapide
Planning Budget
For the Month Ended August 31
Revenue
Expenses:
Cleaning supplies
Electricity
Maintenance
Wages and salaries
Depreciation
Rent
Administrative expenses
Total expense
Net operating income
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