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Survey of Accounting (Accounting I)

8th Edition
Carl Warren
ISBN: 9781305961883

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BuyFindarrow_forward

Survey of Accounting (Accounting I)

8th Edition
Carl Warren
ISBN: 9781305961883
Textbook Problem

Ethics and professional conduct in business

Jas Carillo was discussing summer employment with Maria Perez, president of Valparaiso Construction Service:
Maria: I'm glad that you're thinking about joining us fur the summer. We could certainly use the help. Jas: Sounds good. I enjoy outdoor work, and I could use the money to help with next year's
school expenses.
Maria: I've got a plan that can help you out on that. As you know, I'll pay you $8 per hour; but
in addition, I'd like to pay you with cash. Since you're only working for the summer, it really
doesn't make sense for me to go to the trouble of formally putting you on our pay ml) system.
In fact, I do some jobs for my clients on a strictly cash basis, so it would be easy to just pay you
that way,
Jas: Well, dial's a bit unusual, but I guess money is money.
Maria: Yeah, not only that, it's tax-free!
Jas: What do you mean?
Maria: Didn't you know? Any money that you receive in cash is not reported to the IRS on a
W-2 form; therefore, the IRS doesn't know about the income—hence, it's the same as tax-free
earnings.

Wliy does Maria Perez warn to conduct business transactions using cash (not check or credil card)?

To determine

Concept Introduction:

Morals are judgments, standards, and rules of good conduct in the society. They guide people toward permissible behaviour with regard to basic values. Business ethics are business policies and practices which are made to conduct a business in an ethical and moral way. Ethics can be found it laws but some are developed with the situations and moral and acceptable social behaviors.

To Indicate:

The reason for choosing the payment of salaries in cash

Explanation

Morals are judgments, standards, and rules of good conduct in the society. They guide people toward permissible behaviour with regard to basic values. Business ethics are business policies and practices which are made to conduct a business in an ethical and moral way...

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