Sugar Cane Refining And Processing Company: A Comprehensive Case In Capital Budgeting

Abstract

The Sugar Cane Refining and Processing Company is a comprehensive case covering a firm’s investment decision in fixed assets or capital budgeting.  Most senior level undergraduate and graduate corporate financial management courses cover advanced topics in capital budgeting, including measuring complex cash flows, biasness in the capital budgeting process, agency issues, managerial options and risk adjusting techniques.  To cover these relevant topics in a single case, the invented or “armchair” approach is used.  This case is completely contrived but is very educationally effective.