Claw and Kitty: Gripping a Potential Expansion

內容大綱
In April 2021, the owner and founder of Claw & Kitty (CK) in Markham, Ontario, was considering moving his claw machine arcade to a larger location to continue growing his business. The owner had managed to grow his business despite the challenge of numerous pandemic-related shutdowns, and now he wanted to expand. He needed to decide whether this was a good time to do so. Would CK be able to survive if the Ontario government implemented future lockdowns or capacity limits? The owner had to assess the return and payback he might expect on this large investment and consider how he would fund the expansion. He would need to analyze the incremental revenues and costs and compare these against the investment to determine whether this move made sense from both qualitative and quantitative perspectives.
學習目標
This case can be used in an introductory course on managerial accounting or finance at the undergraduate level. Students should understand relevant costing, the differential cash flow model, and basic business analytical tools. After working through the case and assignment questions, students will be able to do the following:<ul><li>Analyze the internal environment (corporate capabilities) of a company.</li><li>Analyze the external environment (industry and competitors) of a company.</li><li>Determine relevant cash flows of a differential analysis (cash, future, and different) for a business decision.</li><li>Calculate the return on investment and payback period for a future opportunity with sensitivity.</li><li>Make a decision regarding an expansion opportunity and justify it using qualitative and quantitative analyses.</li></ul>
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