$*******$Argue AGAINST Tony Smith's Proposal$********$

Ethical Dilemma $-$

The Precision Parts Corporation manufactures automobile parts. The company has reported a profit every year since

the company's inception in $1980.$ Management prides itself on this accomplishment and believes one important

contributing factor is the company's incentive plan that rewards top management a bonus equal to a percentage of

operating income if the operating income goal for the year is achieved. However, $2024$ has been a tough year, and

prospects for attaining the income goal for the year are bleak.

Tony Smith, the company's chief financial officer. has determined a way to increase December sales by an amount

sufficient to boost operating income over the goal for the year and secure bonuses for all top management. A reputable

customer ordered $$120,000$ of normally stocked parts to be shipped on January $5,2025.$ Tomy told the rest of top

management, "I know we can get that order reacly by December $31.$ We can then just leave the order on the loading

dock until shipment. I see nothing wrong with recognizing the sale in $2024$ since the parts will have been

manufactured, and we do have a firm order from a reputable customer." The company's normal procedure is to ship

goods f$,$o$.$b$.$ destination and to recognize sales revenue when the customer recelves the parts.