Cengage Advantage Books Business Law The First Course Summarized Case Edition 13th Edition by Roger LeRoy Miller - Test Bank Instant Download - Complete Test Bank With Answers Sample Questions Are Posted Below Chapter 5 Business Ethics TRUE/FALSE QUESTIONS B1. Ethics is as well defined …
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Cengage Advantage Books Business Law The First Course Summarized Case Edition 13th Edition by Roger LeRoy Miller – Test Bank
Instant Download – Complete Test Bank With Answers
Sample Questions Are Posted Below
Chapter 5
Business Ethics
TRUE/FALSE QUESTIONS
B1. Ethics is as well defined as the law.
answer: F PAGES: Introduction
BUSPROG: Ethics AICPA: BB-Critical Thinking
B2. Unless a corporation violates a law, its actions do not raise questions about the role of corporations and the effect of corporate ethics on profit.
BUSPROG: Ethics AICPA: BB-Risk Analysis
B3. Originally, the only goal or duty of a corporation was to maximize profits.
answer: T PAGES: Section 1
BUSPROG: Analytic AICPA: BB-Critical Thinking
B4. An overemphasis on long-run profit maximization is the most common reason that ethical problems occur in business.
ANSWER: F PAGES: Section 1
BUSPROG: Analytic AICPA: BB-Critical Thinking
B5. The study of business ethics is concerned with the purposes of a business and how that business achieves those purposes.
ANSWER: T PAGES: Section 1
BUSPROG: Ethics AICPA: BB-Critical Thinking
B6. An action may be legal but not ethical.
ANSWER: T PAGES: Section 1
BUSPROG: Analytic AICPA: BB-Critical Thinking
B7. Acting in good faith gives a business firm a better chance of defending its actions in court.
answer: T PAGES: Section 1
BUSPROG: Analytic AICPA: BB-Legal
B8. Company codes are not law.
ANSWER: T PAGES: Section 1
BUSPROG: Ethics AICPA: BB-Risk Analysis
B9. Ethics is based more on research than judgment.
answer: F PAGES: Section 1
BUSPROG: Analytic AICPA: BB-Legal
B10. Compared to business ethics, employee ethics is not an important issue.
ANSWER: F PAGES: Section 2
BUSPROG: Ethics AICPA: BB-Critical Thinking
B11. Religious rules generally are absolute with respect to the behavior of their adherents.
answer: T PAGES: Section 3
BUSPROG: Ethics AICPA: BB-Critical Thinking
B12. Under the principle of rights theory, one person’s principles are as “right” as another’s.
ANSWER: F PAGES: Section 3
BUSPROG: Ethics AICPA: BB-Critical Thinking
B13. According to utilitarianism, it does not matter how many people suffer a negative effect from an act.
answer: F PAGES: Section 3
BUSPROG: Ethics AICPA: BB-Critical Thinking
B14. The concept of corporate social responsibility is imposed on corporations by law.
answer: f PAGES: Section 3
BUSPROG: Ethics AICPA: BB-Critical Thinking
B15. Corporations can demonstrate corporate social responsibility by promoting goals that society deems worthwhile.
answer: T PAGES: Section 3
BUSPROG: Ethics AICPA: BB-Critical Thinking
B16. It is always clear what is ethical in a given situation.
answer: F PAGES: Section 4
BUSPROG: Ethics AICPA: BB-Critical Thinking
B17. Managers must apply the same standards to themselves as they do to the company’s employees.
ANSWER: T PAGES: Section 4
BUSPROG: Ethics AICPA: BB-Critical Thinking
B18. The Sarbanes-Oxley Act requires companies to set up confidential systems so that employees and others can “raise red flags” about suspected illegal or unethical auditing and accounting practices.
answer: T PAGES: Section 4
BUSPROG: Analytic AICPA: BB-Risk Analysis
B19. Given today’s global communications network, most companies can assume that their actions in other nations will go unnoticed.
ANSWER: F PAGES: Section 5
BUSPROG: Diversity AICPA: BB-Critical Thinking
B20. Some provisions of U.S. bribery laws are directed toward accountants.
answer: T PAGES: Section 5
BUSPROG: Analytic AICPA: BB-Critical Thinking
MULTIPLE-CHOICE questions
B1. In studying the business law, students also review ethics in a business context. Ethics includes the study of what constitutes
answer: A PAGES: Section 1
B2. In making business decisions, Ridgeline Utility Service Company and other corporations should strive to be “good citizens” by evaluating
ANSWER: D PAGES: Section 1
B3. Corporate Security Company provides other firms with security services. Questions of what is ethical involve the extent to which Corporate Security has
answer: B PAGES: Section 1
B4. Desdemona works for eInnovation, Inc. Her job includes putting “spin” on the firm’s successes and failures. In this context, ethics has to do with how businesspersons, in making their decisions, apply
answer: B PAGES: Section 1
B5. Green Hybrid Auto Corporation pays its executives an excessive amount relative to what lower-level employees at the company receive and to what executives at competitive companies are paid. Green Hybrid’s pay scale is most likely to be challenged as
answer: D PAGES: Section 1
B6. Ronelle, the human resources director for Small Business Solutions, Inc., attempts to comply with the law in dealing with applicants and employees. One of the challenges Ronelle faces is that the legality of an action is
ANSWER: C PAGES: Section 1
B7. Brewster, the chief executive officer of Cog & Gear Lubricants Corporation, wants to ensure that Cog & Gear’s activities are legal and ethical. The best course for Brewster and Cog & Gear is to act
answer: A PAGES: Section 1
B8. Situations in which employers face ethical issues with respect to social media platforms include
answer: D PAGES: Section 2
B9. Ryland, an officer for Sports Park, Inc., attempts to apply a duty-based approach to ethical reasoning in conflicts that occur on the job. This approach is based on the idea that a person must
answer: B PAGES: Section 3
B10. Dyan, the owner of Expert Restoration Services, Inc., adheres to the “principle of rights” theory. Under this theory, a key factor in determining whether a business decision is ethical is how that decision
ANSWER: B PAGES: Section 3
B11. Steaks n’ Fries Restaurant Company’s decision makers view a particular risk in the consumption of Steaks n’ Fries’ products as open and obvious. Continuing to market the products without explicitly telling consumers of the risk could be justified from a perspective of
answer: D PAGES: Section 3
B12. Ross, a research manager for Stock & Bond Investments, Inc., adheres to utilitarian ethics. Ross will determine that an action is morally correct when it produces the greatest good for
answer: D PAGES: Section 3
B13. Palette Paints, Inc. expends funds and takes steps to ensure that all employees are safe on the job, that all products are safe for consumers, and that the environmental impact of the corporation is minimal. Palette Paints appears to believe in the concept of
answer: B PAGES: Section 3
B14. Digital Analytics, Inc., considers the impact of its corporate decisions on various groups and often acts in the interest of a group that has a greater stake in a decision than Digital’s shareholders. This approach is most likely to attract potential employees who are
answer: D PAGES: Section 3
B15. Comfort Foods Corporation makes and markets its products nationwide. To be considered socially responsible when making a business decision, Comfort Foods must take into account the needs of
answer: C PAGES: Section 3
B16. GetTogether, A Social Media Company encourages its managers to behave ethically, reasoning that lower-level employees will take their cues from management. One of the most important ways to create and maintain an ethical workplace is for GetTogether’s management to
ANSWER: A PAGES: Section 4
B17. Ricardo suspects his supervisor Simone of unethical accounting practices. But Ricardo does not want to report Simone if she will find out who reported her and fire Ricardo. An important feature of online reporting systems like EthicsPoint is that an employee reporting unethical behavior
answer: A PAGES: Section 4
B18. Lowell runs Medical Debt Collection Agency. He collects debts by misrepresenting the facts and pretending to be licensed to perform various occupations. Lowell’s conduct most likely warrants
answer: B PAGES: Section 4
B19. Discount Mart Corporation contracts with companies in developing nations to produce goods, because the wage rates in those nations are significantly lower than those in the United States. Discount Mart takes steps to avoid bad publicity by monitoring its suppliers’ workplaces to make sure that the employees are not mistreated. Discount Mart is
ANSWER: D PAGES: Section 5
B20. Petro Refining Corporation makes payments to potential customers, suppliers, and others with whom they might do business, including foreign private companies and the representatives of foreign labor organizations. If Petro knows that these payments will be passed on to a foreign government, this practice is
ANSWER: A PAGES: Section 5
ESSAY questions
B1. Precision Tool Corporation sells a product that is capable of seriously injuring consumers who misuse it in a foreseeable way, even though the label warns against the misuse. Does the firm have an ethical duty to take this product off the market? What conflicts might arise if the firm stops selling this product?
ANSWER: Ethical behavior can sometimes generate sufficient goodwill to warrant practicing it out of a desire for increased profits. By the same token, unethical behavior can sometimes generate enough bad publicity to warrant avoiding it out of the same desire. A business firm’s activities that are perceived as ethical and receive wide publicity can benefit the firm’s owners in the short run and even in the long run if the firm’s enhanced public image continues to attract more consumers to its products. There is nothing unethical about making a profit. It is the behavior that generates the profit that can be questionable. Business ethics thus has a practical element. A business firm should act in its best interest. A firm interested in profits should also be interested in the public’s opinion. Of course, it is not a company’s fault when consumers misuse its product despite the warning. If continuing to sell a product is not a strict violation of the law, stopping its sale would likely reduce profits. This could affect the firm’s owners, employees, and others. But suspending sales could reduce injuries, and it could lead to increased profits from the sales of other products, if the suspension stops negative publicity. When a business entity decides to respond to what it sees as a moral or ethical obligation by removing a product from the market, an ethical conflict is raised between the firm and its employees and between the firm and its shareholders. This conflict arises directly out of the impact that the decision has on the firm’s profits. If meeting this perceived obligation increases the firm’s profitability, then all parties “win,” and the dilemma would be easily resolved in favor of “doing the right thing.”
B2. Carney & Deb, Accountants, perform a variety of tasks for their clients—financial statements and tax returns, for example. To accomplish these tasks, Carney & Deb collects their clients’ personal and financial information. Carney & Deb can store the personal and financial information of its clients on any electronic device, including a smartphone, a tablet, a flash drive, a laptop, and a copier. When Carney & Deb upgrades its storage media, the information is transferred between devices. Does Carney & Deb have an ethical obligation to its clients with respect to this information? If so, what are the ethics in the situation?
ANSWER: Yes, Carney & Deb, the accounting firm in this question, have an ethical obligation to its clients with respect to their personal and financial information.
Ethics is the study of what constitutes right and wrong behavior, focusing on morality and the way in which ethical principles are derived or the way in which such principles apply to conduct in daily life. Sometimes the issues that arise concern fairness, justice, and “the right thing to do.”
To answer the question of the accountants’ ethical obligation, it should be noted that the confidentiality of their clients’ sensitive personal and business information is at stake. The accountants have an ethical duty to ensure that reasonable security precautions are taken to preserve this confidentiality and protect this information. In the first instance, the accountants need to understand where they are putting the information, assess what the risks are of that location, and consider whether or not it is appropriate to put the data there. For example, putting sensitive information on an unencrypted flash drive would be a bad idea. In the second instance, client confidentiality needs to be maintained when a storage device is disposed of. The device should be sanitized, or wiped clean of sensitive data, before the device is discarded.
PAGES: Section 1
Original price was: $30.00.$20.00Current price is: $20.00.
Original price was: $30.00.$20.00Current price is: $20.00.
Original price was: $30.00.$20.00Current price is: $20.00.
Original price was: $30.00.$20.00Current price is: $20.00.
Original price was: $30.00.$20.00Current price is: $20.00.
Original price was: $30.00.$20.00Current price is: $20.00.
