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Case from journal
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Reference no. JIACS13-05-12
Published by: Allied Business Academies
Published in: "Journal of the International Academy for Case Studies", 2007

Abstract

Paul Sparks, a successful pharmacist and avid golfer, recently sold his family drug store and is negotiating with Golf Corp LLC to purchase Stonebridge Country Club. Stonebridge Country Club is a private golf course that Sparks has been a member of for the last 20 years. Sparks and Golf Corp LLC have tentatively agreed on a purchase price providing Sparks can arrange financing. Sparks has developed projected income statements, balance sheets and cash flow statements for the first four years of operation for his new company and approached a local commercial bank for a working capital loan and equipment financing. The bank expressed an interest in making the loans but requested Sparks include a cash budget for the first year of operation. The primary subject matter of this case concerns the development and use of a cash budget as a key component in a cash management system. The case requires students to have an introductory knowledge of accounting, finance and general business issues, thus the case has a difficulty level of three (junior level) or higher. The case is designed to be taught in one class session of approximately 1.25 hours and is expected to require 4-6 hours of preparation time from the students.

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Abstract

Paul Sparks, a successful pharmacist and avid golfer, recently sold his family drug store and is negotiating with Golf Corp LLC to purchase Stonebridge Country Club. Stonebridge Country Club is a private golf course that Sparks has been a member of for the last 20 years. Sparks and Golf Corp LLC have tentatively agreed on a purchase price providing Sparks can arrange financing. Sparks has developed projected income statements, balance sheets and cash flow statements for the first four years of operation for his new company and approached a local commercial bank for a working capital loan and equipment financing. The bank expressed an interest in making the loans but requested Sparks include a cash budget for the first year of operation. The primary subject matter of this case concerns the development and use of a cash budget as a key component in a cash management system. The case requires students to have an introductory knowledge of accounting, finance and general business issues, thus the case has a difficulty level of three (junior level) or higher. The case is designed to be taught in one class session of approximately 1.25 hours and is expected to require 4-6 hours of preparation time from the students.

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