Scenario A

question 112

Multiple Choice

Scenario A. Use the information given below to answer the following three questions:
An energy drink corporation faces an ethical question. There has been a problem with the accounting process that has resulted in higher profits being reported than what was actually earned. A meeting is held where senior management decides how to handle the situation. The people at the table have varying views of the appropriate action to be taken. Sarah wants to report the error because she is worried about her job should the information about a cover-up be leaked. Ben wants to report the error because it is the honest thing to do, and he feels that is fundamental to business and society. After hearing the opinion of his colleagues, Ray says he wants to report the error as well because he prefers to agree with the consensus.
-Which ethical system does Ben use to make his decision?

• A) Universalism
• B) Egoism
• C) Utilitarianism
• D) Relativism
• E) Conventionalism

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Definitions:

Costly

Involving high expenses; describing something that requires significant financial outlay.

Periodic Inventory Systems

Periodic Inventory Systems is an inventory management method where inventory levels are updated and physical counts are conducted at specific intervals, typically at the end of an accounting period.

FIFO

An inventory valuation method (First In, First Out) where the oldest inventory items are recorded as sold first.

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a dataset, often used in inventory valuation and grading.