Business Case Studies & Business Publications

Monsanto Company

Lipson, Marc L., G...

Case

Monsanto Company

Lipson, Marc L.; Green, Rick

F-1597 | Published August 20, 2009 | 9 pages Case

Collection: Darden School of Business

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Product Details

Monsanto is facing an uncertain near-term financial outlook, and this case challenges students to generate an operating forecast (income statement and balance sheet operating accounts). The case naturally lends itself to sensitivity analysis related to sales growth assumptions. Suitable for MBA and undergraduate learners, it covers the basics of forecasting without introducing the complexities associated with financing. A teaching note is available.

The technical learning objectives of this case are for students to be able to generate a forecast of operating accounts based on a sales forecast and to be able to evaluate the sensitivity of a forecast to changes in assumptions. A conceptual learning objective is for students to recognize that growth in a firm many not necessarily improve returns since both income and investments will be expanded. In contrast, improvements in efficiency that reduce costs can have a very dramatic effect.