Exercise 1-4 ethics and the manager richmond inc. operates a

exercise 1-4  Ethics and the manager

 richmond inc.  operates a chain of 44 department stores. two years ago, the board of directors of richmond approved a large scale remodeling of its stores to attract a more upscale clientele.before finalizing plans, two stores were remodeled as a test. linda perlman, assistant controller, was asked to oversee the financial reporting for these test stores, and she and other management personnel were offered bonuses based on the sales growth and profitability of these stores. while completing the financial reports, perlman discovered a sizeable inventory of outdated goods that should have been discounted for sale ……


1. according to the IMA’s statement of ethical professional practice, would it be ethical for perlman not to report the inventory as obsolete?

2. would it be easy for perlman to take the ethical action in this situation(CMA updated)


exercise 1-9 ethics and decision making

Ethics and Decision Making

Assume that you are the chairman of the Department of Accountancy at Mountain State Uni¬versity. One of the accounting professors in your department. Dr. Candler. has been consistently and uniformly regarded by students as an awful teacher for more than 10 years. Other accounting professors  within your department  have observed Dr. Candler’s classroom teaching and they con¬cur that his teaching skills are very poor. However. Dr. Candler was granted tenure 12 years ago, thereby ensuring him life-long job security at Mountain State University.


Chapter 1

Much to your surprise, today you received a phone from an accounting professor at. Oregon Coal University. During this phone call you are informed that Oregon Coastal University is on the verge of making a job offer to Dr. Candler. However, before extending the job offer, the faculty at Oregon Coast ;11 wants your input regarding Dr. Candler’s teaching effectiveness while at Mountain State University.


How would you respond to the professor from Oregon Coastal University? What would you say about Dr. Candler’s teaching ability? Would you describe your answer to this inquiry as being ethical? Why?

EXERCISE 1-10 Corporate Social ResponsbIlity

In his book Capitalism and Freedom, economist Milton Friedman wrote on page 133: “There is one and only one social responsibility of business—to use its resources and engage in activities designed to increase its profits so long as it , , engages in Open and free competition, without deception or fraud.”


Explain why you agree or disagree with this quote.


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