Eddie Is the Senior Executive of a Large Toy Company

question 90

Multiple Choice

Eddie is the senior executive of a large toy company.In recent months,the ethics of the company have been brought into question by the media.This is because of the number of faulty toys that it has sold.An investigation of the cause revealed that employees were only concerned with meeting the production quota and quite frequently did not run quality control checks on the toys,despite company regulations.Eddie believes that the long-term solution is to create a more ethical culture within the organisation. Based on the guidelines suggested in the text,which of the following is NOT an example of an appropriate action?

• A)Be a visible role model for his employees.
• B)Provide ethical training to ensure employees are fully aware of acceptable standards.
• C)Have employees openly report the unethical behaviours of others.
• D)Visibly reward people who are ethical and diligent in their examination of the toys.

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Definitions:

Interest Payment

The amount paid at regular intervals (often annually or semi-annually) on a debt instrument such as a bond or loan, based on the interest rate and the principal amount.

Discount on Bonds Payable

Represents the difference when bonds are sold for less than their face (or par) value, indicating that the bond's market rate of interest is higher than its coupon rate.

Par Value

Par value is the face value of a bond or the stock value stated in the corporate charter, below which shares cannot be issued.

Installment Note Payable

A liability representing a loan that requires regular payments or installments over a specified period until the full principal and interest are paid.