Almost everyone has eaten at McDonald’s. Big Macs and Quarter Pounders are part of many people's weekly diet. At last count, McDonald’s serves over 38 million people per day. McDonald’s Corporation is known not only for its fast food but also for its corporate social responsibility efforts. We have listed several social responsibility activi- ties that McDonald’s Corporation decided to undertake:

(a) McDonald's decided to sponsor Ronald McDonald Houses, where families with hos- pitalized children can stay near the hospital for free.

(b) McDonald’s decided to become a major contributor to Jerry Lewis’s fund-raising campaign to fight muscular dystrophy.

(c) McDonald’s decided to employ physically and/or mentally challenged adults who find it more difficult to get jobs.

Although McDonald’s believed that styrofoam containers helped to maintain the quality of its food, it decided to reduce its use of styrofoam containers in response to news reports about the dangers of fluorocarbons and in response to pressures applied by nonprofit environmental groups.

(d —

In each of these cases, McDonald’s senior executives probably consulted managers from some or all of the functional areas (marketing, production, human resources, finance, dis- tribution) before making their decision.

Required: Answer the following questions. Think through your answers carefully so that you can defend the conclusions you reach.

(1) For each of the four activities listed above, list the questions you would ask to de- termine whether McDonald’s decision to undertake this activity helps or hinders the corporation's ability to meet its basic objectives of remaining solvent and earning a satisfactory profit.

(2) For each of the four activities, analyze what functional areas will be affected and how they will be affected. Then, assuming you are the finance manager, use your analysis to write McDonald’s senior executives a memo explaining the impact of activities (a)

and

(d) on your functional area.

(3) Now, think back through your answers to (1) and (2) with one thing in mind— information from other functional areas. More specifically, brainstorm about information that the other functional areas could provide that would improve your ability to answer questions (1) and (2). Use the knowledge you have gained about costs, profits, budgeting, and reporting to help formulate your answer. TK-1