May Company, Inc.: Examining the Outcomes of Corporate Strategic Change Applying an Expanded DuPont Model

Abstract

This case employs a model for conceptualizing and analyzing the financial statement impact resulting from major corporate structural changes in the form of divestiture of an operating segment. The corporate case included here is based on information concerning May Company's divestiture of Payless Shoes. The DuPont model provides a concise view of financial statement elements and the interaction of those elements before and after a structural change is undertaken. When the model is completed it provides a compact comparative view of financial elements that may have been affected by the change. For more advanced students case questions lead to individual discovery of research resources useful for financial analysis beyond the financial statements.