View Policies Current Attempt in Progress 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 made the boarding business extremely competitive. To meet the competition, Green Pastures planned in 2020 to entertain clients, advertise more extensively, and absorb expenses formerly paid by clients such as veterinary and blacksmith fees. The budget report for 2020 follows. As shown, the static income statement budget for the year is based on an expected 19,300 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. GREEN PASTURES Static Budget Income Statement For the Year Ended December 31, 2020 Actual Master Budget Difference 52 60 8 Unfavorable 16,700 19.300 2.600 Unfavorable $334,400 $482,500 $148,100 Unfavorable Number of mares Number of boarding days Sales Less: Variable expenses Feed Veterinary fees Blacksmith fees Supplies Total variable expenses Contribution margin 91,860 51.777 4.386 8,957 156,980 96.500 57.900 4,825 4,640 Favorable 6,123 Favorable 439 Favorable 1,658 Favorable 12,860 Favorable 135,240 Unfavorable 10.615 169,840 177,420 312,660 MacBook Air 35,000 10,000 11,000 35,000 10,000 12,000 1,000 Favorable 9,000 Less: Fixed expenses Depreciation Insurance Utilities Repairs and maintenance Labor Advertisement Entertainment Total fixed expenses Net income 10,000 1,000 Favorable 77.000 11,000 6,000 159,000 $18,420 84,000 7,000 4,000 162,000 $150,660 7,000 Favorable 4,000 Unfavorable 2.000 Unfavorable 3,000 Favorable $132 240 Unfavorable Answer the following Based on the static budget report, did management do a good, average, or poor job of controlling expenses? Management did a in controlling variable expenses. e Textbook and Media Question Part Score --/0.6 meaEORIGINERS Flexible Budget Report For the Year Ended December 31, 2020 Budget 16,700 BD Actual 16,700 BD Boarding days (BD) $ $ 4 e : . MacBook Air