Ethics/Cost Accounting

1 : Ethics Steve Smith has been the Treasurer of Salem Company for the past 5 years. He was recommended for this job by his good friend Bob Johnson. Steve and Bob previously worked together at Supply Company and they still have lunch once a month. Supply Company sells paper to Salem which makes Managerial Accounting textbooks. Without an adequate supply of paper, Salem would not be able to manufacture the textbooks. Because many college students purchase their textbooks on the Internet at sites such as Chegg or Amazon, Salem recently has experienced declining sales and is having cash flow problems. At their next lunch, Steve Smith was considering telling Bob Johnson about Salem's cash flow problems and that Salem won't be able to pay Supply Company's bills for about 6 to 9 months. Steve was concerned that if Bob knew about the cash flow problems he would stop selling paper to Salem which would completely disrupt the production of the textbooks and pu t an additional strain on their cash flows. Steve was also concerned that Bob was already informed about Salem Company's cash flow from a mutual friend, Michael, who also worked at Salem Company problems 8 Required: 1) Referring to the specific standards in the IMA'S "Standards of Ethical Conduct for Management Accountants", if Steve Smith does tell Bob Stevens of Salem's cash flow problems would he be violating any of those specific standards? Please provide an explanation for each standard you believe would be violated. Assuming Steve Smith confirmed that Michael had previously informed Bob Stevens about Salem's cash flow problem. Describe the recommended steps that Steve Smith should take to resolve this issue. 2) Oo