Accounting for Non-Accounting Majors

RUNNING HEAD : Accounting for Non-Accounting Majors

Accounting for Non-Accounting Majors

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6 May 2009

This seeks to determine whether given situations for Fitness Solutions are ethical or unethical after this researcher ' has defined what is ethical vs . unethical . This will also answer whether what is ethical equates with what is legal with the needed justification for the position taken . In addition , this will also identify the effects on the financial statement and decide whether the events reflect errors or

deliberate fraud by Fitness Solutions

This researcher defines what is unethical as something that violates the idea of fairness or justice as when it unfairly causes a net disadvantage to stakeholder and a net advantage in favor of the decision-maker (Henderson , et . al , 2005 . Therefore , an act is presumed ethical if there is no evidence that it not fair or just to all concerned . While what is ethical does not necessarily equate with what is legal , sometimes , that two could be equal if the effect of the legal act would be an ethical act . To apply the definition to the situations this researcher asserts , the first situation - when Fitness Solutions changes from LIFO inventory method to FIFO method , which directly affects inventory balances and income taxes --- is ethical . Said first situation is not unethical because changing from LIFO to FIFO would instead increase ending inventory balance and could even income increase taxes . In fact , LIFO was planned to be...