Assignment #1: Capital Budgeting at Laurentian Bakeries You are asked to do a full capital budgeting analysis for a facility expansion at Laurentian Bakeries Abridged ( The case is available under the...

Assignment #1: Capital Budgeting at Laurentian Bakeries

You are asked to do a full capital budgeting analysis for a facility expansion at Laurentian Bakeries Abridged (The case is available under the Resources tab. Check under library e-reserves.)

You should take the role of Danielle Knowles and create a thorough capital budgeting analysis of the proposed expansion of the Winnipeg pizza facility. In addition to the final recommendation, you will need to consider both quantitative and qualitative aspects of the decision. Students should pay attention to the corporate decision rules that govern investments at Laurentian Bakeries and consider how this proposal fits into the company strategy (i.e. hurdle rate; requirement for continuous improvement etc.)

Your report should have an executive summary. The body of the report should be brief (3-5 pages), and it should be accompanied by a fully documented and properly formatted spreadsheet. Students should consider sensitivity and scenario analysis as appropriate. At a minimum, you need to consider the pessimistic and optimistic scenarios described in the case. Ignore inflation when doing your analysis.

* Some of the qualitative aspects of the case may be difficult to quantify. It is not necessary to incorporate information from outside the case facts. If there is information that you need and you do not have it, just note the information you would like to have and how it might help in the decision-making process.