Sandy Lang and Mandy Starr, Two Salespersons in Adjoining Territories

question 1

Essay

Sandy Lang and Mandy Starr, two salespersons in adjoining territories, regularly compete for bonuses. During the last month, their dollar volume of sales, on which the bonuses are based, was nearly equal. On May 30, 2014, each made a large sale. Both orders were shipped on May 31, 2014, the last day of the month, and both were received by the customers on June 5, 2014. Sandy's sale was FOB shipping point (ownership passes to buyer at time of shipping), and Mandy's was FOB destination (ownership passes to buyer at time of receipt). The printed policy of the company states that sales "count" for purposes of calculating bonuses on the date that ownership passes to the purchaser. Sandy's sale was therefore counted in her May monthly total of sales while Mandy's sale was not. Mandy is quite upset. She has asked you to just include it, or to take Sandy's off as well. She also has told you that you are being unethical for allowing Sandy to get a bonus just for choosing a particular shipping method.
As the accounting manager write a memo to Mandy on June 15, 2014, and explain your position.

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Definitions:

Confederate

In psychological research, a confederate is someone who pretends to be a participant but is actually working with the researchers, often used in studies to manipulate social situations.

Scientific Method

A systematic and logical approach to the discovery of new information, based on empirical evidence and characterized by observation, experimentation, and hypothesis testing.

Social Psychologist

A professional who studies how people’s thoughts, feelings, and behaviors are influenced by the actual, imagined, or implied presence of others.

Numerical Trends

Patterns or directions that emerge from the analysis of numerical data over a period of time.