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Horizon corporation manufactures personal computers. the company began operations in 2016 and reported profit for the years 2016 through 2019. Due primarily to increase competition
Horizon corporation manufactures personal computers. the company began operations in 2016 and reported profit for the years 2016 through 2019. Due primarily to increase competition in price slashing and in the industry 2020s income statement reported a loss of 20 million. just before the end of the 2021 fiscal year a memo from the companies chief financial officer to Jim fielding, The company controller includes the following comments:
If we did not do you something about the large amount of unsold computers already manufactured our auditors will require us to write them off ,their result in a loss for 2021 will cause a violation of our debt convenant Enforces the company into bankruptcy I suggest that you ship half of our inventory to JB sales, inc in Oklahoma City I know the company is president and he will except the merchandise and acknowledge the shipment as a purchase we can record the sales in 2021 which will boost profits to an acceptable level then JB sell with simply return the merchandise and 2020 after the financial statement have been issued.
requiremets : Discuss the ethical dilemma Jim faces?, what is the issue? ,who are the parties involved ? What factors should jim consider while making this decision?
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