Ethics in Action

DB6 – Ethics in Action

For this week’s discussion, consider the following:

TAC Industries sells heavy equipment to large corporations and to federal, state, and local governments. Corporate sales are the result of a competitive bidding process, where TAC competes against other companies based on selling price. Sales to the government, however, are determined on a cost-plus basis, where the selling price is determined by adding a fixed markup percentage to the total job cost.

Tandy Lane is the cost accountant for the Equipment Division of TAC Industries Inc. The division is under pressure from senior management to improve income from operations. As Tandy reviewed the divisions job cost sheets, she realized that she could increase the divisions income from operations by moving a portion of the direct labor hours that had been assigned to the job order cost sheets of corporate customers onto the job order costs sheets of government customers. She believed that this would create a win-win for the division by (1) reducing the cost of corporate jobs and (2) increasing the cost of government jobs whose profit is based on a percentage of job cost. Tandy submitted this idea to her division manager, who was impressed by her creative solution for improving the divisions profitability.

INITIAL POST:

For your post discuss if you feel Tandy’s plan is ethical? Explain.

Your post must be a minimum of 100 words, and it must be your original work. Do not plagiarize. Cite your sources when appropriate

Last Completed Projects