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CASE STUDY IS ATTACHED: Although budgeting may appear to be a straightforward set of calculations, there are still many areas in the budgetary process where unethical practices may occur. By misusing...

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CASE STUDY IS ATTACHED:

Although budgeting may appear to be a straightforward set of calculations, there are still many areas in the budgetary process where unethical practices may occur. By misusing tools or calculations, a deceitful picture of an organization’s financial reality can be painted, misleading investors, employees, or stockholders.
For this Application, you will first need to review the case study, “Conflict Between Doing Well and Doing Good?” found in this week’s Resources.
Formulate a brief response for each of the seven questions listed at the end of the case study.

In addition, comment on some potential consequences of unethical behavior in budgeting. Find examples in the news to demonstrate the consequences.

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Although budgeting may appear to be a straightforward set of calculations, there are still many areas in the budgetary process where unethical practices may occur. By misusing tools or calculations, a deceitful picture of an organization’s financial reality can be painted, misleading investors, employees, or stockholders. For this Application, you will first need to review the case study, “Conflict Between Doing Well and Doing Good?” found in this week’s Resources. Formulate a brief response for each of the seven questions listed at the end of the case study.  In addition, comment on some potential consequences of unethical behavior in budgeting. Find examples in the news to demonstrate the consequences.

Answered Same Day Dec 25, 2021

Solution

Robert answered on Dec 25 2021
121 Votes
Case Study 6
Running Head: CASE STUDY
Case Study
Capital Budgeting Tool
Coors is the company that provides quality beverages to the customers and started its business in 1873. In the increased competition, the company has consistently performed well and its stock prices are also rising. By analyzing its future rate of return, managers can make the decision related to whether the project is value-enhancing project or not. Apart from this, the company should also identify the overall cost of acquiring the project (He
st, 2003, p. 5-7). At the same time, the net present value method is the suitable to toil in order to identify the value of the project in the future. Net present value method is the tool through which, companies calculate the present value of any investment, so that, investors can be able to make efficient decisions for the projects.
Cash Flows for Project
In order to identify the incremental cash flow, the company calculates the overall cash inflow and cash outflow. In order to produce the beer, the cost of production includes direct material, overhead and direct labor cost. It is identified that company has to incur lower transportation cost for transfe
ing the yeast. The company has saved the $0.30 and company has to incur $1567 direct labor cost of the ethanol distillation process (Ross, Westerfield & Jordan, 2008, p. 303-304). Moreover, the company also pays 15% of revenue as overhead expenses. In the capital expenditure, Coors and Me
ick divided its partnership in the ratio of 30:70. On the other hand, it is identified that the company will earn huge profits through the use of waste materials. An initial investment of the company is not much, it is because the company has used its land, which has already owns for the plant. Thus, a company incurs the cost of the infrastructure as well as distillation towers.
Benefits that company will obtain in the future are 34% of the overall production. The company has maintained a sound position in the market in the future and obtained...
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