24. [Effect of inventory methods on contracts] The Sechne Company has entered into a number of agreements in the past year. These agreements contain provisions that depend on the firm's reported financial statements: (i) Management compensation plan. Bonuses are based on a weighted average of reported net income and cash from operations. (ii) Bund indenture. Specifies that the firm must maintain a mummum level of working capital. and dividend pay- ments to shareholders require a minimum level of re- tained earnings. (iii) Labor contract. Employees have a profit-sharing plant that pays them a share of reported net income in excess of a specified level Sechne's corporate controller. who is both a manager and a shareholder, must select the accounting methods used for finan- cial reporting. Discuss how these agreements may affect the con- troller's choice of an inventory accounting method for Sechne