Vincent Buys a Lawn Mower

7 Pages Posted: 23 Jan 2019 Last revised: 11 May 2019

See all articles by Gregory Fairchild

Gregory Fairchild

University of Virginia - Darden School of Business

Stephen E. Maiden

Independent

Abstract

Vincent Chin's first "temporary" job after high school was with the lawn crew of Holiday Lawn Service. Ten years later, Chin has become a trusted employee and the company's second-in-command. His boss, Sam Holiday, has decided to retire and has worked out a deal with Chin to take over the business. In preparing Chin for his new role, Holiday explains that there are important choices ahead related to capital expenditures (like lawn mowers) and their depreciation. Although Chin is determined to build on the company's success, accounting sometimes confused him, and the mention of terms like taxes and cash flow always intimidated him. Can Holiday help his successor better understand the links among accelerated depreciation, maintenance expense, salvage value, and tax liabilities to ensure that he's ready for his new business responsibilities?

Excerpt

UVA-F-1794

Rev. Apr. 26, 2019

Vincent Buys a Lawn Mower

Introduction

Vincent Chin could barely sleep all night, so he popped out of bed at 5:30 a.m. In a few short hours he would be able to count himself a real business owner: the owner of Holiday Lawn Service. “No more working for the man,” he chuckled into the mirror, his smile growing as he spread shaving cream across his face.

“Shh! The baby is sleeping. Come back to bed,” his wife, Janet, whispered.

. . .

Keywords: entrepreneurship, accounting, budgeting, capital expenditures, depreciation

Suggested Citation

Fairchild, Gregory and Maiden, Stephen E., Vincent Buys a Lawn Mower. Darden Case No. UVA-F-1794. Available at SSRN: https://ssrn.com/abstract=3320840

Gregory Fairchild (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.darden.virginia.edu/faculty/fairchild.htm

Stephen E. Maiden

Independent

No Address Available

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