Week 12 Discussion

Please note that this discussion board will require a minimum of three posts. These consist of your initial post, your response to comments that I post to your thread, and at least one response to a classmate. If you post late in the week, it's possible that I may not be able to provide a comment to you. In that case, please be sure to provide response posts to at least two classmates.

Chapter 13: QuickBooks Merchandise Company

Additionally, please refer to Chapter 13 in your Cengage Accounting eText, accessible from the eText link in the Course Navigation Panel to the left of your screen.

Required:

Tommy Gunn is a division manager for K-Cern Inc., a small pharmaceutical company. Tommy's division has been working on a new drug that has the potential to revolutionize the treatment of skin cancer. Once the drug is proven to be effective in clinical trials, it will be approved for sale by the government and patented by the company. Because of the potential market for this drug, it is highly likely that the company's revenues and net income will increase significantly when it is approved. Tommy recently saw an internal company memo indicating that the drug passed its final clinical trial and that the company has received government approval to sell the drug. The company will issue a press release announcing this news in the next two days, and this announcement is expected to result in a dramatic increase in the company's stock price. Tommy knows that there is free money to be made if he invests in the stock before the announcement is made. However, K-Cern has a strict policy against employee purchases of company stock outside of established employee stock purchase plans. To get around this rule, Tommy asks his father to purchase the stock for him. The next morning Tommy's father purchases the stock with the understanding that he will split the profits with Tommy.

Is Tommy behaving ethically? Please discuss why or why not?

Responses to Classmates:

Please let your classmates know about some of the differences between a sole proprietorship and a corporation.

Response to Instructor:

Please check your thread for questions or comments from me and be sure to provide a comprehensive response, as requested.

Writing:

Please make sure that your initial post contains a properly cited reference. Please use APA style. You should cite your text as a minimum. Additionally, check your spelling and proofread your post before you hit the submit button.