Ivey Publishing

Product Details

Stone Rock Golf & Country Club: Wedding Bells?
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10 pages (6 pages of text)
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Case (Field)
In 2016, the general manager of Stone Rock Golf & Country Club (SRGCC) in Ainslie, Ontario, was considering an opportunity to grow the club’s weddings and special events business. SRGCC, a popular 18-hole golf course in a small town, was owned and operated by four local families, who ran the business according to their family values and their sense of loyalty and pride in their community. Since the golf industry had recently experienced a significant decline, the manager believed that increased investment in the weddings and special events business would help to strengthen and diversify SRGCC’s revenues. He was considering three different options, from modest to quite substantial: (1) focus on the immediate capital need of renovating the outdated maintenance facility; (2) make a large investment that included adding a new space for weddings and special events, expanded parking, and a new maintenance facility; or (3) do nothing and maintain the status quo. To complete the entire renovation, the club would require an investment of close to $1 million as well as approval from the four families. How could he build a case to increase SRGCC’s revenues and convince both his banker and the board of directors to accept his choice?
Learning Objective:
This case is suitable for undergraduate- or graduate-level students in the long-term investment or capital budgeting section of a managerial accounting course. It assumes a prior understanding of long-term investment decisions and capital budgeting and should not be used as an introduction to these topics. After working through the case and assignment questions, students will be able to
  • evaluate an investment opportunity from a qualitative standpoint;
  • forecast net operating cash inflows on a potential investment while incorporating taxes;
  • analyze a potential long-term investment opportunity by properly calculating the net present value and internal rate of return and conducting a sensitivity analysis;
  • perform benchmarking analysis using ratios; and
  • assess credit feasibility.
    Accounting,  Entrepreneurship
    Arts, Entertainment, Sports and Recreation
    Canada, Small, 2016
    Intended Audience:
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