Question
Unipolar Cars' CFO Hamza Hussain recently installed ABC method at the company's Winnipeg production plant where three models-the 1.2L Tiago, the 1.5L Revolution, and the
Unipolar Cars' CFO Hamza Hussain recently installed ABC method at the company's Winnipeg production plant where three models-the 1.2L Tiago, the 1.5L Revolution, and the 2.0L Harrier--are manufactured. Hamza's new product costs for these three models show that the company's traditional costing system had been significantly under-costing the 2.0L Harrier. This was due primarily to the lower sales volume of the Harrier compared to the Tiago and the Revolution. Before completing his analysis and reporting these results to management, Hamza is approached by his friend Nikhil, who is the production manager for the 2.0L Harrier model. Nikhil has heard from one of Hamza's staff about the new product costs and is upset and worried for his job because the new costs show the Harrier to be losing, rather than making, money. Nikhil requests Hamza not to report the results to management. Hamza responds by saying that he will think about it.
- Who are the stakeholders in this situation?
- What are the ethical considerations in this situation?
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