Toolkit Pty Ltd manufactures high-quality tools for sale to tradespeople. The company produces two major lines of products — spanners and hammers. Trevor is the manager of spanner production and Helmut is the manager responsible for hammer production. The direct materials for the spanners and hammers are different as they are made with different metal alloys and the hammers also have a rubber handle supplied by a rubber manufacturer. The direct labour for each product line is also usually separate as different skills are required for making spanners than for making hammers. Occasionally, one of the hammer manufacturers, Leanne, does a few hours work per week on making spanners as she has had some experience in making both lines of tools. The factory overhead is divided between spanners and hammers based on the number of each produced. Both Trevor and Helmut receive bonuses based on how much they can minimise the production costs of their products.

Maria is the accountant for Toolkit and is responsible for allocating all costs to manufactured goods. Trevor and Maria are engaged and Trevor’s bonuses will be helpful in meeting the costs of the wedding. After much discussion, Trevor has convinced Maria that, as no record is kept of Leanne’s time spent making spanners instead of hammers, it would be easier just to charge all of Leanne’s wages to direct labour for hammers. Usually an estimate is made of Leanne’s time spent on spanners. Trevor also convinced Maria that rather than allocating the factory overhead based on the number of spanners and hammers produced, it would be better to use the hours of production of each. This meant that instead of spanners receiving 60% of factory overhead they would receive only 50%.

Required

A. Who are the stakeholders in this situation?

B. Are there any ethical issues involved? If so, what are they?

C. What would you do if you were Maria?