Case Study Analysis and Solutions

Simulation ID: 7070

Abstract:
Simulation Solution for Working Capital Simulation: Managing Growth V2 by Sandeep Dahiya
In this single-player simulation, students act as the CEO of a small company, Sunflower Nutraceuticals, and decide whether to invest in growth and cash-flow improvement opportunities in three phases over 10 simulated years. Each opportunity has a unique financial profile and students must analyze effects on working capital. Examples of opportunities include taking on new customers, capitalizing on supplier discounts, and reducing inventory. Students must understand how the income statement, balance sheet, and statement of cash flows are interconnected and consider the possible effects of each opportunity on the firm's financial position. The company operates on thin margins with a constrained cash position and limited available credit. Students must optimize use of "internal" and external credit as they balance the desire for growth with the need for maintaining liquidity. The second release of this simulation adds an optional financing decision for students, a new metric tracking the firm's equity value, and a new optional problem set.

Keywords:
Accounting, Cash flow, Cash flow statements, Credit management, Entrepreneurial finance, Entrepreneurial management, Finance, Growth strategy, Small Business Administration, Working capital, Working Capital Simulation Managing Growth V2 Solution

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