Managerial Analysis

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Excel spread ending in a 700 word memo I believe. Sending an attachment along with this

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Green Pastures Static Budget Income Statement For the Year Ended December 31, 2017 Actual Master Budget 52 60 8U 19,000 21,900 2,900 U $380,000 $547,500 $167,500 U Feed 104,390 109,500 5,110 F Veterinary Fees 58,838 65,700 6,862 F Blacksmith Fees 4,984 5,475 491 F Supplies 10,178 12,045 1,867 F Total Variable Expenses 178,390 192,720 14,330 F Contribution Margin 201,610 354,780 153,170 U Depreciation 40,000 40,000 -0- Insurance 11,000 11,000 -0- Utilities 12,000 14,000 2,000 F Repairs and Maintenance 10,000 11,000 1,000 F Labor 88,000 95,000 7,000 F Advertisement 12,000 8,000 4,000 U Entertainment 7,000 5,000 2,000 U Number of Mares Number of Boarding Days Sales Difference Less: Variable Expenses Less: Fixed Expenses Total Fixed Expenses 180,000 184,000 4,000 F Net Income $21,610 $170,780 $149,170 U Grading Guide Content Met Partially Met Not Met Comments: Content Met Partially Met Not Met Total Available Total Earned 6 #/6 Partially Met Not Met Comments: Based on the static budget report answer the following questions: o What was the primary cause(s) of the loss in net income? o Did management do a good, average, or poor job of controlling expenses? o Were management’s decisions to stay competitive sound? Prepared a flexible budget report for the year. Based on the flexible budget report, answer the following questions: o What was the primary cause(s) of the loss in net income? o Did management do a good, average, or poor job of controlling expenses? o Were management’s decisions to stay competitive sound? Answer the following question: • What course of action does student recommend for the management of Green Pastures? Showed work in Microsoft® Word or Excel®. Completed calculations/computations using Microsoft® Word or Excel®. The examination is a minimum 700 words in length. Writing Guidelines The paper—including tables and graphs, headings, title page, and reference page—is consistent with APA formatting guidelines and meets course-level requirements. Intellectual property is recognized with in-text citations and a reference page. Met Comments: Writing Guidelines Met Partially Met Not Met Total Available Total Earned 2 #/2 Comments: Paragraph and sentence transitions are present, logical, and maintain the flow throughout the paper. Sentences are complete, clear, and concise. Rules of grammar and usage are followed including spelling and punctuation. Purpose of Assignment This comprehensive case requires students to evaluate a static budget and prepare flexible budgets to meet managerial needs. Students are required to calculate and analyze variances and discuss how variances are critical to managerial decision making. Assignment Steps Resources: Generally Accepted Accounting Principles (GAAP), U.S. Securities and Exchange Committee (SEC), Green Pastures Static Budget Income Statement Tutorial help on Excel® and Word functions can be found on the Microsoft® Office website. There are also additional tutorials via the web offering support for Office products. Scenario: Green Pastures is a 400-acre farm on the outskirts of the Kentucky Bluegrass, specializing in the boarding of broodmares and their foals. A recent economic downturn in the thoroughbred industry has led to a decline in breeding activities, and it has made the boarding business extremely competitive. To meet the competition, Green Pastures planned in 2017 to entertain clients, advertise more extensively, and absorb expenses formerly paid by clients such as veterinary and blacksmith fees. The budget report for 2017 is presented as an attachment. As shown, the static income statement budget for the year is based on an expected 21,900 boarding days at $25 per mare. The variable expenses per mare per day were budgeted: feed $5, veterinary fees $3, blacksmith fees $0.25, and supplies $0.55. All other budgeted expenses were either semifixed or fixed. During the year, management decided not to replace a worker who quit in March, but it did issue a new advertising brochure and did more entertaining of clients. Develop a minimum 700-word examination of the financial statements and include the following: • Based on the static budget report: o What was the primary cause(s) of the loss in net income? o Did management do a good, average, or poor job of controlling expenses? o Were management's decisions to stay competitive sound? • • • Prepare a flexible budget report for the year. Based on the flexible budget report: o What was the primary cause(s) of the loss in net income? o Did management do a good, average, or poor job of controlling expenses? o Were management's decisions to stay competitive sound? What course of action do you recommend for the management of Green Pastures? Show your work in Microsoft® Word or Excel®. Complete calculations/computations using Microsoft® Word or Excel®. Format the assignment consistent with APA guidelines.
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Green Pastures
Flexible Budget Report
For The Year Ended December 31, 2017
Budget at 19,000
Actual at 19,000
Boarding Days
boarding days
52
52
Number of Mares
19.000
19.000
Number of Boarding Days
475.000
380.000
Sales
Less: Variable Expenses
95.000
104.390
Feed
57.000
54.838
Veterinary Fees
4.750
4.984
Blacksmith Fees
10.450
10.178
Supplies
167.200
178.390
Total Variable Expenses
307.800
201.610
Contribution Margin
Less: Fixed Expenses
40.000
40.000
Depreciation
11.000
11.000
Insurance
14.000
12.000
Utilities
11.000
10.000
Repairs & Maintenance
95.000
88.000
Labor
8.000
12.000
Advertisement
5.000
7.000
Entertainment
184.000
180.000
Total Fixed Expenses
123.800
21.610
Net Income

0
0
95.000 U
9.390
2.162
234
272
11.190
106.190

U
F
U
F
U
U

2.000
1.000
7.000
4.000
2.000
4.000
102.190

F
F
F
U
U
F
U


RUNNING HEAD: MANAGERIAL ANALYSIS

Managerial Analysis
Student Name
Unit Code-Name of Institution
Date

1

2

MANAGERIAL ANALYSIS
The static budget report compares the actual performance of Green
Pastures at 19,000 boarding days to its budgeted performance of 21,900
boarding days. The net income has an unfavorable difference of $149,170 from
the budgeted.
Difference

Proportion

Sales

167,500 U

0.31

Total Variable Expenses

14,330 F

0.07

Contribution Margin

153,170 U

0.43

Total Fixed Expenses

4,000 F

0.02

Net Income

149,170

0.87

The above is analysis of the difference in determinants of income from the
budge...


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