Carver Lumber sells lumber and general building supplies to building contractors in a medium-sized town...
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Accounting
Carver Lumber sells lumber and general building supplies to building contractors in a medium-sized town in Montana. Data regarding the store's operations follow: - Sales are budgeted at $366,000 for November, $336,000 for December, and $316,000 for January. - Collections are expected to be 90% in the month of sale and 10% in the month following the sale. - The cost of goods sold is 70% of sales. - The company desires to have an ending merchandise inventory equal to 70% of the following month's cost of goods sold. Payment for merchandise made in the month following the purchase. - Other monthly expenses to be paid in cash are $26,300. - Monthly depreciation is $19,200. - Ignore taxes. Lenci Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 5,240 units, but its actual level of activity was 5,190 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: The spending variance for manufacturing overhead in May would be closest to
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