Cliff Davis joined Company A as controller in October 2016. Company A manufactures and installs home greenhouses. The company uses a normal-costing system with two direct-cost pools, direct materials and direct manufacturing labor. and one indirect-cost pool, manufacturing overhead. In 2016, manufacturing overhead was allocated to jobs at 150% of direct manufacturing labor cost. At the end of 2016, an immaterial amount of underallocated overhead was closed out to cost of goods sold, and the company showed a small loss. Davis is eager to impress his new employer, and he knows that in 2017, Company A's upper management is under pressure to show a profit in a challenging competitive environment because they are hoping to be acquired by a large private equity firm sometime in 2018. At the end of 2016, Davis decides to adjust the manufacturing overhead rate to 160% of direct labor cost. He explains to the company president that, because overhead was underallocated in 2016, this adjustment is necessary. Instructions: Answer the question below using 150 words or more. After this, respond to one of your peer's responses using 50 words or more. Do you think there were any ethical issues when Davis adjusted the overhead rate to 160%