Distinguish Between Each Stage of Ethical Reasoning in Kohlberg's Model

question 7

Essay

Distinguish between each stage of ethical reasoning in Kohlberg's Model of Moral Development and related effects on accounting decision-making when there is a difference of opinion with management on the proper recording of a material amount of expense.

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Definitions:

Machinery

Physical devices or equipment designed to perform specific tasks in industrial or commercial settings, often part of the fixed assets of a business.

Soft Rationing

The situation that occurs when units in a business are allocated a certain amount of financing for capital budgeting.

Hard Rationing

The situation that occurs when a business cannot raise financing for a project under any circumstances.

Hard Capital Rationing

A situation where a company is unable to secure additional funding from external sources like equity or debt markets.