- Discussion 1 Shabby Fitch is the president and principal stockholder of Shabby's Bar and Grill, Inc. To expand, the business is applying for a $350,000 bank loan. To get the loan, Fitch is considering two options for beefing up the stockholder's equity of the business. Option 1: Issue $200,000 of common stock for cash. A friend has wanted to invest in the company. This may be the right time to extend the offer. Option 2: Transfer $200,000 of Fitch's personal land to the business, and issue common stock to Fitch. Then, after obtaining the loan, Fitch can transfer the land back to himself and the balance in the common stock account will then equal $0. Use the ethical decision model in Chapter 1 to answer the following questions for each option: 1. What is the ethical issue? 2. Who are the stakeholders? What are the possible consequences to each? 3. Analyze the alternatives from the following standpoints: (a) economic (b) legal and (c) ethical. 4. What would you do? How would you justify your decision? How would your decision make you feel afterward