Tutorial in Financial Modeling
Caribbean Internet Café[1] case:
A tutorial in managerial accounting concepts and financial modeling using Excel
Assignment 1: Introduction
We will begin our work this semester with a case called Caribbean Internet Café [hereafter, CIC]. In the CIC case, David Grant wants to open an Internet Café in Kingston, Jamaica. This simple business setting is familiar; how many coffee shops, drive-up or otherwise, can you think of that are within walking distance of campus? Even if you are not a coffee-holic, the operation of one of these places should be fairly self-evident. This assignment will help to fulfill a number of major objectives of the course: 1. The CIC case makes use of a relatively familiar context in which to introduce many of the managerial accounting concepts we will deal with this semester. The familiarity of the context should enable you to associate managerial accounting terminology with real world phenomena. 2. The structure of this series of exercises also provides an opportunity to develop your skills in using Excel to do financial modeling. Irrespective of your preferences for a career choice, financial modeling will be a critical skill in your professional life. Marketers and HR specialists take note: there is no avoiding the numbers. 3. The majority of you are still relatively early in your path through the School of Business program. Case analyses will be an important element in several of your subsequent courses. One key to successful case analysis is meticulous organization of relevant facts and information. The approach I am suggesting is one way to ensure that you have all the information you need in one place.
We’ll work through the case over several days, developing an increasingly sophisticated understanding of the concepts and terminology of managerial accounting. At times, the CIC case will be very much in the foreground as we use David’s situation to illustrate basic concepts. At other times, the case will be in the
A tutorial in managerial accounting concepts and financial modeling using Excel
Assignment 1: Introduction
We will begin our work this semester with a case called Caribbean Internet Café [hereafter, CIC]. In the CIC case, David Grant wants to open an Internet Café in Kingston, Jamaica. This simple business setting is familiar; how many coffee shops, drive-up or otherwise, can you think of that are within walking distance of campus? Even if you are not a coffee-holic, the operation of one of these places should be fairly self-evident. This assignment will help to fulfill a number of major objectives of the course: 1. The CIC case makes use of a relatively familiar context in which to introduce many of the managerial accounting concepts we will deal with this semester. The familiarity of the context should enable you to associate managerial accounting terminology with real world phenomena. 2. The structure of this series of exercises also provides an opportunity to develop your skills in using Excel to do financial modeling. Irrespective of your preferences for a career choice, financial modeling will be a critical skill in your professional life. Marketers and HR specialists take note: there is no avoiding the numbers. 3. The majority of you are still relatively early in your path through the School of Business program. Case analyses will be an important element in several of your subsequent courses. One key to successful case analysis is meticulous organization of relevant facts and information. The approach I am suggesting is one way to ensure that you have all the information you need in one place.
We’ll work through the case over several days, developing an increasingly sophisticated understanding of the concepts and terminology of managerial accounting. At times, the CIC case will be very much in the foreground as we use David’s situation to illustrate basic concepts. At other times, the case will be in the