Location: Brook Park, OH
The attached spreadsheet is a model for the Go Kart Raceway, located in Brook Park, Ohio. It is currently listed for sale at $495,000. This model includes an income statement, a balance sheet, and a future cash flows. The numbers used in the previous mentioned statements were derived from assumptions made from the area where the Go Kart Raceway is located. Using the model, a weighted average cost of capital and internal rate of return were calculated. We used a debt to equity ratio of 70%/30% to calculate the weighted average cost of capital.
Our model also includes two scenarios for two different markets with their respective probabilities. The probabilities are assumptions for the market for this type of business (entertainment). Lastly, the model includes an option to build an enclosure around the raceway track to increase the occupancy rate. Our model indicates that the listed sales price is more than our valuation of the business.