Brad Taylor has just reviewed his internal financial statements for the month of November and is dismayed

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Brad Taylor has just reviewed his internal financial statements for the month of November and
is dismayed that he might not achieve his profit targets for the year, which ends in a month. As a
result, he might miss out on a $10,000 bonus for surpassing his target for the year. After consulting with the managers reporting to him, he concludes that something dramatic must happen if he
is going to meet his numbers. An idea occurs to him: he can postpone the start of the marketing
campaign that was to start in mid-December to mid-January and avoid having to recognize the
expense of developing the campaign until the next fiscal year.
He realizes that delaying the marketing campaign by one month might impact his sales for the
following year, but he is willing to deal with that issue next year at this time. The bonus is really
important to him as he promised his wife a January cruise.
Required:
I. Is Brad behaving ethically in how he is approaching the problem? Why or why not?
2. What suggestions do you have for Brad in arriving at a satisfactory solution to his dilemma?

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
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Cornerstones of Managerial Accounting

ISBN: 978-0176721237

3rd Canadian edition

Authors: Maryanne Mowen, Don Hanson, Dan Heitger, David McConomy, Bradley Witt, Jeffrey Pittman

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