Exercise 9-14 (Algo) Prepare a Flexible Budget Performance Report [LO9-4] 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 $ 0.60 Electricity $ 1,100 $ 0.10 Maintenance $ 0.15 Wages and salaries $ 4,900 $ 0.30 Depreciation $ 8,100 Rent $ 2,200 Administrative expenses $ 1,800 $ 0.03 For example, electricity costs are $1,100 per month plus $0.10 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.00 per car washed. The actual operating results for August are as follows: Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,300 Revenue $ 51,300 Expenses: Cleaning supplies 5,420 Electricity 1,890 Maintenance 1,470 Wages and salaries 7,720 Depreciation 8,100 Rent 2,400 Administrative expenses 1,946 Total expense 28,946 Net operating income $ 22,354 Required: Prepare a flexible budget performance report that shows the company’s revenue and spending variances and activity 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 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:

For example, electricity costs are $1,000 per month plus $0.06 per car washed. The company expects 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.

Required:

Prepare a flexible budget performance report that shows the company’s revenue and spending variances and activity 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.)

ounts as positive values.)

Exercise 9-9 Prepare a Report Showing Revenue and Spending Variances [LO9-2]

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:

For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expects to wash 9,000 cars in August and to collect an average of $4.90 per car washed.

The actual operating results for August are as follows:

Required:

Calculate 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. Do not round intermediate calculations.)

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:

For example, electricity costs are $1,300 per month plus $0.06 per car washed. The company expects to wash 8,400 cars in August and to collect an average of $6.70 per car washed.

The actual operating results for August appear below.

Required:

Prepare a flexible budget performance report including the master or planning budget that shows the company’s revenue and spending variances and activity 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.)

A listed industrial company is considering a major investment. The company’s investment projects team needs an appropriate rate at which to discount the estimated after-tax cash flows for the investment. Following the company’s normal practice this is based on the Weighted Average Cost of Capital.

Statement of financial position/long-term financing information:

The loan interest for the current year has just been paid. Interest is payable at the end of each of the next 3 years and the loan is to be redeemed, in cash, at a 5% premium at the end of the three years.

A dividend of 18c per share has just been paid. Dividends have shown an average annual growth rate of 7% over recent years.

The current share price is 210c and the loan has a market value of $97 (per $100 nominal).

The corporation tax rate is expected to be 30% for the near future.

Required:

1. Calculate the company’s Weighted Average Cost of Capital (WACC).

Explain your workings and any assumptions.

Justify the basis of the weightings which you used.

2. Explain any criticisms which could be made of using the figure calculated above as the discount rate for assessing the investment.

Colbert has been a waiter at the Burger Report in Starkville, Mississippi for four years. The Burger Report treats its employees well, allowing them a 60 percent discount for any food that they buy and consume on the premises (e.g., a $10 meal will cost only $4). In 2019, the value of the discount for Colbert amounted to $2,500 for days on which he was working and $1,500 for days when he was not assigned to work but still stopped by during mealtimes. The average profit the Report earns on a meal is 25 percent (i.e., the cost of a $10 meal is about $8.00). There is no requirement that Colbert eat at the Report during his breaks and some days he does and others he does not. Fortunately, there are a number of other eating establishments near the Report that Colbert can walk to and still get back to his fryolator with plenty of time before his shift starts again. The Report is adequately staffed so it’s not as if Colbert needs to stay at the restaurant to be “on call,” after all, there is no such thing as a “burger emergency!” Prepare a tax research memorandum in good form that provides your conclusion on Colbert’s treatment of the meals provided by his employer at a discount in 2019 for federal tax purposes. Do not consider any reporting by the Report on Colbert’s W-2—focus on only Colbert’s responsibility. Therefore prepare a tax research memo

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 $ 1,300 $ 0.07 Maintenance $ 0.15 Wages and salaries $ 4,300 $ 0.20 Depreciation $ 8,100 Rent $ 1,800 Administrative expenses $ 1,600 $ 0.03 For example, electricity costs are $1,300 per month plus $0.07 per car washed. The company expects to wash 8,200 cars in August and to collect an average of $6.20 per car washed. The actual operating results for August appear below.

he actual operating results for August appear below.

Required:

Prepare a flexible budget performance report that shows the company’s revenue and spending variances and activity 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.)

1. Received $28,500 cash from the issue of common stock. 2. Purchased inventory on account for $140,000. 3. Sold inventory for $172,500 cash. Sales tax was collected at the rate of 7 percent on the inventory sold. 4. Borrowed $18,000 from First State Bank on March 1, 2016. The note had a 7 percent interest rate and a one-year term to maturity. 5. Paid the accounts payable (see transaction 2). 6. Paid the sales tax due on $140,000 of sales. Sales tax on the other $32,500 is not due until after the end of the year. 7. Salaries for the year for the one employee amounted to $31,000. Assume the Social Security tax rate is 6.20 percent and the Medicare tax rate is 1.45 percent. Federal income tax withheld was $5,000. 8. Paid $2,600 for warranty repairs during the year. 9. Paid $12,500 of other operating expenses during the year. 10.Paid a dividend of $5,200 to the shareholders. Adjustments: 11. The products sold in transaction 3 were warranted. Park estimated that the warranty cost would be 6 percent of sales. 12. Record the accrued interest at December 31, 2016. 13. Record the accrued payroll tax at December 31, 2016. Assume no payroll taxes have been paid for the year and that the unemployment tax rate is 6.20 percent (federal unemployment tax rate is 0.60 percent and the state unemployment tax rate is 5.60 percent on the first $7,000 of earnings per employee). Cost of goods sold was 105,500

Now do the Statement of cash flows . balance sheet income statement statement of changes in stock holders equity

Use the following information to answer the next four questions: Consider two municipalities, A and B, in the same province. Residents in municipality A enjoy attending outdoor music concerts (a public good) held in their public park. Each resident in municipality A has a marginal benefit curve for these concerts given by MB=10-2Q, where Q is the number of outdoor concerts. There are 100 residents in this municipality. Residents in municipality B do not enjoy outdoor music concerts (they are more into sports activities). Each resident in municipality B therefore receives no marginal benefit for these concerts. There are 400 residents in municipality B. Each municipality has the same constant marginal cost of providing these concerts given by MC=125. Suppose outdoor music concerts are typically financed by municipalities with distortionary taxation and that the marginal cost of public funds is MCF=1.6 (assume with no tax exporting).

44. The efficient number of concerts in municipality A is _______________.

45. The efficient number of concerts in municipality B is _______________.

46. Now suppose the two municipalities amalgamate. As a result assume that each of the two municipalities is required to have the same number of concerts and that the number in each municipality is the average of the number before amalgamation. The total loss in net social welfare resulting from the requirement that the two municipalities provide the same number of concerts is $ ___________________.

47. Suppose that instead of financing their concerts with distortionary taxation each of the municipalities (before their amalgamation) had the option of shifting all their tax burden (of financing their concerts) to other jurisdictions through tax exporting. Under this scenario, the number of concerts provided by municipality A (before its amalgamation) would have been ____________.

Please answer with work!!