Assignment
Tokyo Disneyland and the DisneySea Park:
You are assigned to work on the following case:
Tokyo Disneyland and the DisneySea Park: Corporate Governance and Differences in Capital Budgeting Concepts and Methods Between American and Japanese Companies
This is a case about a joint venture called Tokyo DisneySea Park between Walt Disney Corp. and Oriental Land Corp., which explores the differences in capital budgeting techniques (such as NPV) between American and Japanese methods.
Task
Disney case
• Explain the differences between the Japanese and American investment decision-making processes and the conflicts that arise from there.
• Calculate the following values, and please show your work:
o the new project valuation using the Japanese capital budgeting technique (average accounting return method)
o the terminal value for DisneySea Park to be used for the American methods
o NPV for the Tokyo DisneySea Park using data from Exhibit 7
o capital budgeting using the average cash flow return (ACFR) method
• Why do you think that OL made the major investment to undertake this project in 1997, even though the decision could not be supported by its own capital budgeting method, meaning the AAR method?
Format your assignment according to the give formatting requirements:
• The answer must be using Times New Roman font (size 12), double spaced, typed, with one-inch margins on all sides.
• The response also includes a cover page containing the student's name, the title of the assignment, the course title, and the date. The cover page is not included in the required page length.
• Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.