ETHICS CHALLENGE $$P$4$

BTN $11-1$ Cameron Bly is a sales manager for an automobile dealership. He earns a bonus each year based on revenue from the number of autos sold in the year less related warranty expenses. Actual swarranty expenses have varied over the prior $10$ years from a low of $3\%$ of an automobile's selling price to a high of $10\%.$ In the past, Bly has tended to estimate warranty expenses on the high end to be conservative. He must work with the dealership's accountant at yearend to arrive at the warranty expense accrual for cars sold each year.

Does the warranty accrual decision create any ethical dilemma for Bly$?$

Because warranty expenses vary, what percent do you think Bly should choose for the current year? Justify your response

$3$