Azure Lodging, Inc.: A Case Study on Capital Budgeting with Capital Rationing in a Service Industry Context

Autor:	James W. Hesford, Michael Burkert, Michael J. Turner, Thomas G. Calderon
Rok vydání:	2021
Předmět:	Capital budgeting Finance business.industry Accounting Capital (economics) Management accounting Rationing Context (language use) Cash flow Business Investment (macroeconomics) Net present value Education
Zdroj:	Issues in Accounting Education. 37:67-89
ISSN:	1558-7983 0739-3172
DOI:	10.2308/issues-18-117
Popis:	This case illustrates capital budgeting in a service industry context. Three features should make this case attractive to instructors. First, the firm's rationing of capital means that students must select one investment among competing investment alternatives. Second, the project involves renovation of an existing hotel. Most cases analyze a business expansion by estimating the net present value of a single series of cash flows (i.e., either future cash flows occur or do not occur). In this case, students model cash flows if the project is accepted, comparing those cash flows to a model of cash flows if the hotel continues without renovation. Third, we introduce Monte Carlo analysis, which is an advanced technique for assessing uncertainty. The extensive data students use in this case are from an actual hotel chain's project database. The case has been used in undergraduate and graduate managerial accounting classes. Data Availability: Available as downloadable supplemental material files.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::786736eb3ef6331e3dece6a41000c3db https://doi.org/10.2308/issues-18-117 Zobrazit plný text záznamu