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Identifying ethical standards

The Institute of Management Accountants’ Statement of Ethical Professional Practice requires managerial accountants to meet standards regarding competence, confidentiality, integrity, and credibility. Consider the following situations. Which standard(s) is(are) violated in each situation?

b. You see others take home office supplies for personal use. As an intern, you do the same thing, assuming that this is a “perk.”

Short Answer

Expert verified

The ethical standard violated, in this case, is integrity.

Step by step solution

01

Definition of a perk

The perks are defined as an advantage or something extra in the form of money or some goods.

02

Identification of violated ethical standards

The correct option is integrity standards.

In this case, if the intern takes home office supplies for personal use, which means that the employee is stealing from the employer of the business.

Stealing from the employer is a violation of integrity standards.

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Most popular questions from this chapter

Computing cost of goods manufactured

Use the following inventory data for Caddy Golf Company to compute the cost of goods manufactured for the year:

Direct Materials Used $ 12,000

Manufacturing Overhead 21,000

Work-in-Process Inventory:

Beginning Balance 1,000

Ending Balance 5,000

Direct Labor 9,000

Finished Goods Inventory:

Beginning Balance 18,000

Ending Balance 4,000

Classifying period costs and product costs

Langley, Inc. is the manufacturer of lawn care equipment. The company incurs the following costs while manufacturing edgers:

• Handle and shaft of edger

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• Factory labor for workers assembling edgers

• Lubricant used on bearings in the edger (not traced to the product)

• Glue to hold the housing together

• Plant janitorial wages

• Depreciation on factory equipment

• Rent on plant

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Requirements

1. Describe the difference between period costs and product costs.

2. Classify Langley’s costs as period costs or product costs. If the costs are product costs, further classify them as direct materials, direct labor, or manufacturing overhead.

Computing direct materials used

Tuscany, Inc. has compiled the following data:

Purchases of Direct Materials $ 6,300

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Compute the amount of direct materials used.

Preparing an income statement and calculating unit cost for a merchandising company

Clyde Conway owns Clyde’s Pets, a small retail shop selling pet supplies. On December 31, 2018, the accounting records of Clyde’s Pets showed the following:

Merchandise Inventory on December 31, 2018 $ 10,100

Merchandise Inventory on January 1, 2018 15,900

Net Sales Revenue 56,000

Utilities Expense for the shop 3,300

Rent for the shop 4,100

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True Fit Shoe Company makes loafers. During the most recent year, True Fit incurred total manufacturing costs of \(21,900,000. Of this amount, \)2,600,000 was direct materials used and \(14,800,000 was direct labor. Beginning balances for the year were Direct Materials, \)700,000; Work-in-Process Inventory, \(1,500,000; and Finished Goods Inventory, \)1,100,000. At the end of the year, balances were Direct Materials, \(800,000; Work-in-Process Inventory, \)2,000,000; and Finished Goods Inventory, $1,080,000.

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2. Cost of goods manufactured for the year.

3. Cost of goods sold for the year.

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