How Might the Budgeting Process Be Used Ethically Within an Organization

question 74

Multiple Choice

How might the budgeting process be used ethically within an organization?

• A)A sales manager defers sales to future periods once she has met her quota for the month to avoid having her budgeted quota increased in future periods.(She worries an increased quota would prevent her from spending time with her ailing father. )
• B)A production manager begins production on orders that have not been placed in order to meet a budgetary goal for production units started during a period.(She worries that failing to meet a production goal will cause her department to forfeit their bonuses for the year. )
• C)An entrepreneur offers a steep discount on services to increase the number of clients served during the quarter.(He worries his investor will withdraw funding if the service numbers aren't met and employees will lose their jobs. )
• D)An accounting manager implements budgeting procedures to measure the environmental impact of the production process,striving to reduce emissions from the factory.(She worries not enough emphasis is placed on the non-financial measures of success. )

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Definitions:

Income Mobility

The ability of individuals or families to move up or down the economic ladder within a lifetime or from one generation to the next.

Income Ladder

A metaphorical representation of the distribution of income across individuals or households in a society, indicating levels of wealth or poverty.

Quintile

A statistical value that divides a group of data into five equal parts, each containing 20% of the population.

Transfer Payment

Payments made by governments to individuals without any goods or services being exchanged, such as social security benefits.