CP 22-1 Ethics in Action 2 The director of marketing for Starr Computer Co., Megan Hewitt, had the following discussion with the company controller, Cam Morley, on July 26 of the current yeari Ethics Megan: Cam, it looks like I'm going to spend much less than indicated on my July budget. Cam: I'm glad to hear it Megan: Well, I'm not so sure it's good news.I'm concerned that the president will see that I'm under budget reduce my budget in the future. The only reason I look good is because we delayed an advertising campaign the campaign hits in September, I'm sure my actual expenditures will go up. You see, we are also having ae convention in September. Having the advertising campaign and the convention at the same time is going to kill my September numbers. . Once our sales Cam: I don't think that's anything to worry about. We all expect some variation in actual spending month to month What's really important is staying within the budgeted targets for the year. Does that look as if it's going to be a problem? Megan: I don't think so, but just the same, I'd like to be on the safe side. 1121 Chapter 22 Budgeting Megan: Well, this is what I'd like to do. I want to pay the convention-related costs in advance this month. IlI pay the hotel for room and convention space and purchase the airline tickets in advance. In this way, I can charge all these expenditures to July's budget. This would cause my actual expenses to come close to budget for July. Moreover, when the big advertising campaign hits in September, I won't have to worry about expenditures for the conven- tion on my September budget. The convention costs will already be paid. Thus, my September expenses should be pretty close to budget. Cam:I can't tell you when to make your convention purchases, but I'm not too sure it should be expensed on July's budget. Megan: What's the problem? It looks like "no harm, no foul'to me.I can't see that there's anything wrong with this- it's just smart management. How should Cam Morley respond to Megan Hewitt's request to expense the advanced payments for convention-related costs against July's budget? ge will be of