The Chairman of a Welfare Organization Asks an Employee to Head

question 40

Multiple Choice

The chairman of a welfare organization asks an employee to head a fundraising activity. The employee, however, embezzles $250,000 from the funds raised from the activity and falsifies financial records. In this scenario, the behavior of the employee is _____.

• A) illegal but ethical
• B) illegal and unethical
• C) legal but unethical
• D) legal and ethical

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Definitions:

Variable Production Costs

Variable production costs refer to expenses that change in direct proportion to the volume of production, such as raw materials and labor costs.

Sales Commissions

Payments made to sales personnel based on the sales volume or value they have achieved.

Opportunity Cost

The potential benefit that is given up when one alternative is selected over another.

Variable Selling

Variable selling costs are expenses that fluctuate with sales volume, such as commissions and credit card fees, which increase as sales increase.