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Coffee, costs, and competition: a case exercise for managerial accounting

Linda A. Hall (SUNY Fredonia, Fredonia, New York, USA)
Jayanti Bandyopadhyay (Salem State University, Salem, Massachusetts, USA)
Susan McNamara (SUNY Fredonia, Fredonia, New York, USA)

The CASE Journal

ISSN: 1544-9106

Publication date: 5 January 2015

Abstract

Synopsis

This case illustrates the implications of the business challenges faced by an on‐campus student‐run convenience store when an internationally known coffee company opened a competing store. The case exercises focus on the application of managerial accounting concepts relevant for future strategic decision making. Students have the task of extracting relevant data from descriptive information. Using the story of an actual student‐run coffee shop that confronted an emerging competitor and thus necessitating these analyses can provide an attractive alternative to teaching managerial accounting concepts that are often considered by students as “dry.”

Research methodology

Case information was obtained from actual student organization and university data slightly modified to facilitate calculation and application of managerial accounting topics. Identities of the institution, the student run store and the international competitor have been disguised at their request. Certain events and dates have been altered to protect identities.

Relevant courses and levels

Relevant courses include but are not limited to: Introductory Managerial Accounting and Cost Accounting at the undergraduate business or accounting and the graduate MBA level.

Theoretical basis

Teaching opportunities include the application of managerial accounting concepts relevant for future strategic decision making. Topics include cost‐volume‐profit, sales‐mix, and break‐even analyses, conversion of traditional income statements to contribution margin income statements, and internal control issues.

Keywords

Citation

Hall, L.A., Bandyopadhyay, J. and McNamara, S. (2015), "Coffee, costs, and competition: a case exercise for managerial accounting", The CASE Journal, Vol. 11 No. 1, pp. 95-101. https://doi.org/10.1108/TCJ-05-2014-0036

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited