Beruflich Dokumente
Kultur Dokumente
by Elizabeth M.A. Grasby, Ian Dunn Source: Richard Ivey School of Business Foundation 7 pages. Publication date: Nov 22, 2010. Prod. #: 910B13-PDF-ENG The owner/operator of an ice cream store has an opportunity to expand his product line to include soft-serve ice cream. He needs to analyze the costs and benefits of purchasing either a new or used single-head or triple-head soft-serve ice cream machine. He also wants to continue growing the business and he wonders about the best way of going about it. Students are asked to (1) perform a business size-up; (2) analyze the addition of soft-serve ice cream from a qualitative standpoint; (3) determine which of the cash flows associated with the opportunity are relevant and which are recurring costs versus one-time costs; (4) perform a differential analysis to determine the ROI and payback period for the purchase of both new machines; (5) determine the ROI and payback period changes if a used machine is purchased; and (6) decide whether to purchase a soft-serve ice cream machine and, if so, which one.
This is part of the subset of Ivey cases and technical notes written for Introductory-Level courses.