Marco Brolo is one of three partners who own and operate Silkroad Partners, a global import– export business. Marco is the partner in charge of recording partnership transactions in the accounts. On his way to work one day, Marco’s car broke down. At the repair shop, Marco learned that his car’s engine had significant damage, and it will cost over $2,000 to repair the damage. He does not have enough money in his bank accountto cover the cost of the repair, and his credit cards are at their limit. This car is the only form of transportation that Marco has to get to and from work every day. He does not use his car for any business travel. After considering his options, Marco decides to take $2,000 from the partnership for the repair and record it as an expense of the partnership. He believes that this is appropriate since he needs his car to get to work every day.1. Is Marco behaving ethically? Why or why not?2. Who is affected by Marco’s decision?3. What other alternatives might Marco consider?

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Asked Dec 2, 2019
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Marco Brolo is one of three partners who own and operate Silkroad Partners, a global import– export business. Marco is the partner in charge of recording partnership transactions in the accounts. On his way to work one day, Marco’s car broke down. At the repair shop, Marco learned that his car’s engine had significant damage, and it will cost over $2,000 to repair the damage. He does not have enough money in his bank account
to cover the cost of the repair, and his credit cards are at their limit. This car is the only form of transportation that Marco has to get to and from work every day. He does not use his car for any business travel. After considering his options, Marco decides to take $2,000 from the partnership for the repair and record it as an expense of the partnership. He believes that this is appropriate since he needs his car to get to work every day.
1. Is Marco behaving ethically? Why or why not?
2. Who is affected by Marco’s decision?
3. What other alternatives might Marco consider?

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Expert Answer

Step 1

1. State whether the action of MB is ethical or not.

The behavior of MB is unethical, because an S partner is an individual entity as per business entity principle, and the expense for car is a personal expense of MB. Hence, it should not be recorded as business expense. At the same time, there is no specific provision in the rules of firm to bear the charges for the repair of vehicle.

Step 2

2. Identify the people who are affected by the decision of MB.

In this case, the decision of MB may affect the other two partners, because the recording of the rep...

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