Kindly answer the 2 questions.Note: Here are the following guidelines for solving an ethical issue. Please use these steps.1. Identify the facts.2. Identify the ethical issue.3. Analyze the alternative courses of action.4. Make a decision. ACTIVITY 2: IS THIS ETHICAL?You are the accounting officer of two corporations of Dela Cruz family, a wealthyfamily in your locality. They own ABC Co. and XYZ Co. ABC Co. is a tax-exempt entity andas such, it is not liable to pay income tax. On the other hand, XYZ Co. is a taxable company.The products of ABC Co. are being used as raw materials for XYZ Co. Hence, ABC Co.sells its inventories to XYZ Co. The Dela Cruz family decided to charge XYZ Co. a very highprice for good delivered by ABC Co. In this case, even though sales revenue of ABC Co. willincrease, there will be no increase in taxes since it is tax-exempt. On the other hand, thepurchase cost of XYZ Co. will increase resulting to higher deductible expenses and lowertaxable income. The income tax of XYZ Co. will decrease. Overall, there will be a reductionin taxes for the businesses of Dela Cruz family.A.B.Is the action of the Dela Cruz family ethical? Explain.As the accounting officer of the two companies, what will you do? Use theguidelines in resolving an unethical issue.

In this scenario involving the Dela Cruz family and their two companies, ABC Co. and XYZ Co.,…

Kindly answer the 2 questions. Note: Here are the following guidelines for solving an ethical issue. Please use these steps. 1. Identify the facts. 2. Identify the ethical issue. 3. Analyze the alternative courses of action. 4. Make a decision.

Kindly answer the 2 questions. Note: Here are the following guidelines for solving an ethical issue. Please use these steps. 1. Identify the facts. 2. Identify the ethical issue. 3. Analyze the alternative courses of action. 4. Make a decision.

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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