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A minority shareholder in a new operation has been offered a sum of money by the majority shareholder to buy up his shares. The question is whether or not the price offered is fair, in light of the fact that the market for these new golf clubs is highly unpredictable and the production costs are not truly representative of the actual amounts that will be required.

The president and general manager of a franchised automobile dealership investigates a capital expenditure for a new body shop to replace a smaller, leased facility. The case is designed to test students on their knowledge of capital expenditure analysis, to underline the impact that inflation adjustments have on capital expenditure analysis, and to push students to make judgements on the key analytical figures that may have an impact on the net present value calculation.

A consulting engineering firm, is involved in a road construction project in Asia which is plagued with difficulties. The firm is working with the local government highway department on the project and has the status of advisor. Actual construction is done by the government department. The problems that the firm must contend with include technical problems, a budget process, differing objectives and intercultural relations. Two years into the project, only 17 kilometres of the 245-kilometre highway were under construction. This case provides the background briefing for the in-basket exercise, An International Project Manager's Day, consisting of three cases, An International Project Manager's Day (A), An International Project Manager's Day (B) and An International Project Manager's Day (C). An alternative teaching approach, as a decision-making exercise, is presented in the teaching note 5A84C40 and supplementary case, An International Project Manager's Day (D).

The director of the Victoria Hospital Pharmacy has been forced by a request from his superior to confront and consider the possibility that people could die because of weaknesses in his operating systems. In a health care system, the operating environment must support, not only ideally, but in reality, 100% quality control with no defects. The one-time failure or lapse in the performance of the operating system(s) can have tragic consequences for all involved. The director must decide if Victoria Hospital Pharmacy is delivering the level of quality service expected of it by the public through its existing systems.

Mr. Panetta, owner of Cosmo's Restaurants Limited is trying to make some important decisions on the future of his family business. Panetta has the options of not growing, growing by opening a third drive-in/takeout restaurant or by manufacturing and marketing the restaurant's best selling product, the Cosmobob. Originally an in-house product, the Cosmobob was successfully marketed to local restaurants by Panetta, and the demand for the product has outgrown the restaurant's production facilities. Panetta is determined to make a decision in the best interests of his family.

The assistant credit manager for a jewellery wholesaler, must assess and compare the credit standing of two of their retail clients. The assessment, which would be used to determine if changes in credit policy were necessary, had to be submitted to both the credit manager and the sales manager in one week. This case provides students the opportunity to calculate financial ratios and use them in decision making. The focus should be on the development of the ratios and trying to appraise one business versus the other. If time is available, the instructor may wish to spend some time on credit appraisal. A follow-up to this case is available, Gardiner Wholesalers Incorporated (B), case 9A84J003.

This case is a follow-up to Gardiner Wholesalers (A) case, 9A84J002, where the assistant credit manager, is assessing the credit standing of two retail clients. Her analysis of past financial performance was complete but a banker friend suggested that the credit report should include projected statements so that the future financing needs of the two jewellery retailers could be estimated. The case provided the retail managers' views on the future of the respective companies as well as some recent trends in the retail marketplace. There is ample information to construct projected income statements and balance sheets.

In response to dismissal of a newly hired administrative assistant, all 10 of this company's executive assistants have vacated their posts and demanded that the plant's manager reverse the young woman's discharge. Otherwise, the 10 women have threatened to walk out in order to air their protest on a national news program.

Crossroads Tavern is a short two part exercise on break-even analysis. In the first part, the owner and manager are attempting to assess the level of sales (measured in units and dollars) required for the firm to: (a) achieve a profit of zero; (b) achieve a target profit of $30,000; and (c) achieve a net cash flow of zero. In the second part, the manager is evaluating the idea of expanding the hours of operation, and is attempting to determine the sales volume necessary to make such an expansion feasible.

Disc Importers is a classical record importer and wholesaler which has just completed its first year of operations. The controller has asked other executives for assistance in choosing an inventory valuation method. The choices revolve around the four standard inventory valuation options (LIFO/FIFO/average cost/specific identification), and the uses which the executives wish to make of the financial statement information. As well, the controller wants to evaluate the impact of the lower-of-cost-or-market rule on ending inventory evaluation. There has been substantial increases in the unit cost of discs throughout the year, and hence the inventory valuation method chosen will impact the financial statements.

The president of Petro-Canada Products Limited proposes to restructure his division of the company. His proposal is for an unusually decentralized organization, by oil industry standards, and it needs to be approved by the company's executive council. The case presents background material on the oil industry, West's division, and the specifics of his proposal. The reaction of other executives in the firm to the proposal is also presented.

Scott's, well-known for Kentucky Fried Chicken, is considering entering the pizza business. The corporate strategist has identified the two most attractive alternatives which he sees as strategically inconsistent: an acquisition would allow the company to penetrate the pizza market quickly with a minimum of innovative development; locating pizza outlets on company-owned land already occupied by Kentucky Fried Chicken stores would make a great use of existing corporate assets. In his recommendations to the Board of Directors, he needs to consider the results of a consumer survey as well as the company's strengths and weaknesses. Two follow-up cases are available Scott's Restaurants (B) and Scott's Restaurants (C).

This case is a sequel to Scott's Restaurants (A). The market research carried out in case (A) indicates that Scott's could establish a pre-emptive position in the take-out pizza market by concentrating on a limited number of basic requirements: cleanliness, product quality, and quality of service. Therefore, the pizza plan is implemented according to the marketing plan. However, early test results are not very promising. A new market survey is conducted for Scott's by a consulting firm.

A large Ontario ski resort faces a decision about whether to invest in facilities for night skiing. Demand is very uncertain, so the management undertakes a market research study. Day skiers at the facility are surveyed about their potential interest during the month of February and March. The resort's management is suspicious about the validity of the results of the research, but has no time to collect further data.

Bloomfield has to decide what price to charge for fertilizer for the upcoming selling season. He is facing competitive pressure to reduce his price and realizes that if he maintains his price, he will certainly lose volume next year.

The mechanics of preparing projected financial statements are described to provide an understanding of the methods used in preparation, and to outline how these projections can be modified and used in financial planning and management decision making.

This note discusses cost behaviour, break-even analysis contribution and projected income statements. In addition to the theoretical framework, two examples are presented and analyzed.

This note examines several of the financial analysis techniques used in marketing decision-making. The goals of marketing management are usually financial in nature. Accordingly, financial considerations are important both when selecting among alternative marketing activities and when evaluating the outcome of a marketing course of action.

Martin Trailers Limited, which has grown rapidly, produces a line of camping trailers, which have a pronounced seasonal sales pattern. Details for the previous year's planning process, staffing levels, production outputs and costs are reviewed by the owner, with the objective of improving the management of materials in the year ahead. Sufficient information is available to perform a quantitative analysis of the aggregate planning decision and its relationship to material requirements planning.

The plant manager for Noram Foods was considering the impact of changing Noram's policy on package weight. Noram Foods in Canada had an enviable record of sound financial performance, although there had been a period of declining profits when the Canadian economy suffered under conditions of high unemployment, high interest rates, and high inflation. Leo Marsden believed the weight control issue represented a major opportunity for re-evaluation and increased performance.