What are some of the chapter locator function to locale in chantier president Communication Activity the changes you points in mind 14.4 Refer to P14.5A and add the following requirement. p ure a letter to the president of the company, Shelly Phillips, describing the ch lain clearly why net income is different after the changes. Keep the following poi compose your letter should be gener be president by her is first (for 1. This is a letter to the president of a company, who is your friend. The style shoul formal, but you may relax some requirements. For example, you may call the preside name. 2. Executives are very busy. Your letter should tell the president your main results first the amount of net income). 3. You should include brief explanations so that the president can understand the chane in the calculations. stand the changes you may Ethics Case CT14.5 Steve Morgan, controller for Newton Industries, was reviewing production costo year. One amount in these reports continued to bother him-advertising. During the year, the had instituted an expensive advertising campaign to sell some of its slower-moving product too early to tell whether the advertising campaign was successful. There had been much internal debate as how to report advertising cost. The vice preside finance argued that advertising costs should be reported as a cost of production is like materials and direct labor. He therefore recommended that this cost be identified as manufacture overhead and reported as part of inventory costs until sold. Others disagreed. Morgan beli that this cost should be reported as an expense of the current period, so as not to overstate income. Others argued that it should be reported as prepaid advertising and reported as a cum asset. The president finally had to decide the issue. He argued that these costs should be reported as a tory. His arguments were practical ones. He noted that the company was experiencing financial de and expensing this amount in the current period might jeopardize a planned bond offering. A reporting the advertising costs as inventory rather than as prepaid advertising, less attention directed to it by the financial community. Instructions a. Who are the stakeholders in this situation? b. What are the ethical issues involved in this situation? c. What would you do if you were Steve Morgan