Ethics (Business/Accounting)

Running Head : ETHICS ASSIGNMENT 2

Ethics Assignment 2

ACC 604

October 19 , 2008

Ethics Assignment 2

In the case study , Pat should make up his mind whether to purchase a certain electronic component from a new supplier or retain his previous supplier . On the surface , the decision is an easy one to make because the price of the new supplier is 0 .20 cheaper than the standard price which is what is being offered by the previous supplier . Logic therefore dictates that Pat should change his supplier because doing so

would mean considerable savings for the company . However , the situation is not at all what it appears to be because of two reasons . First , the new supplier is not reliable . His record shows persistent delays after only his third delivery . Second , the quality of his workmanship is not good Aside from yielding more defective units , the life span of his component is only 75 percent that of the previous supplier 's . In other words , the savings that the company could initially generate from dealing with the new supplier would eventually be offset not only by more frequent s due to the shorter life span but more so by the fact that its reputation could be jeopardized

His decision would have both positive and negative effects . If he decides to purchase from the new supplier , the company would initially benefit by generating a substantial savings upon purchase . However , the company 's benefit would be short-lived primarily because its reputation would eventually...