Question

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

	Fixed Cost per Month			Cost per Car Washed
Cleaning supplies				$	0.40
Electricity	$	1,200		$	0.06
Maintenance				$	0.25
Wages and salaries	$	4,400		$	0.30
Depreciation	$	8,400
Rent	$	2,100
Administrative expenses	$	1,400		$	0.03

For example, electricity costs are $1,200 per month plus $0.06 per car washed. The company actually washed 8,600 cars in August and collected an average of $6.00 per car washed.

Required:

Prepare the company’s flexible budget for August.

Answer 1

The answer has been presented in the supporting sheet. Foor detailed answer refer to the supporting sheet.