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please write out the answers to E and F in a few sentences each. thank you! Ethics in Managerial Accounting! Julie Wicks, the cost accountant
please write out the answers to E and F in a few sentences each. thank you!
Ethics in Managerial Accounting! Julie Wicks, the cost accountant for Stewart Jet Ski Company, recently installed activity-based costing at Stewart's Lakeland plant where three models, the 70 horsepower Tourer, the 120 horsepower Commuter, and the 300 horsepower Racer, are manufactured. Julie's new product costs for those three models show that the company's traditional costing system had been significantly under costing the 70 horsepower Tourer. This was due primarily to the lower sales volume of the Tourer compared to the Commuter and the Racer. Before completing her analysis and reporting these results to management, Julie is approached by her friend Frank Hanson, who is the production manager for the 70 horsepower Tourer model. Frank has heard from one of Julie's staff about the new product costs and is upset and worried for his job because the new costs show the Tourer to be losing, rather than making, money. At first, Frank condemns the new cost system, whereupon Julie explains the practice of activity-based costing and why it is more accurate than the company's present system. Even more worried now, Frank begs Julie, "Massage the figures just enough to save the line from being discontinued. You don't want me to lose my job do you? Anyway, nobody will know." Julie holds firm but agrees to recompute all her calculations for accuracy before submitting her costs to management (e) Using the IMA Statement of Ethical Professional Practice, identify the standards that Julie would violate should she go along with Frank's request. Be specific and explain why the standard would be violated. (9 points) (h) How could Julie help her friend yet still uphold her ethical obligations? (9 points) Step by Step Solution
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