An Example of a Company Action That Should Be Considered

question 44

Multiple Choice

An example of a company action that should be considered legal but unethical would be to ________.

• A)hire a friend who was less qualified than other candidates
• B)pay a teenager less than the minimum wage because the person needed job experience
• C)promote only people of the same race as you
• D)allow lunch breaks of only ten minutes to increase productivity

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Definitions:

Operating Cycle

The average period of time between the purchase of inventory and the collection of cash from receivables, indicating how quickly a company can turn its products into cash.

Sales On Account

Transactions where goods or services are sold to a customer with an agreement that payment will be made at a later date.

Cost Of Goods Sold

The total cost directly associated with the production of the goods sold by a company.

Times Interest Earned

A ratio that measures a company's ability to meet its interest obligations, calculated by dividing earnings before interest and taxes (EBIT) by the interest expense.