Read the scenario below and respond to discussion points that follow in 2-3 paragraphs.

SCENARIO: Due to an economic recession, Anton Corporation faces severe cash flow problems. Management forecasts that payments to some suppliers will have to be delayed for several months. Jay Newton, controller, has asked his staff for suggestions on selecting the suppliers for which payments will be delayed.

“That’s a fairly easy decision,” observes Tim Haslem. “Some suppliers charge interest if our payment is late, but others do not. We should pay those suppliers that charge interest and delay payments to the ones that do not charge interest. If we do this, the savings in interest charges will be quite substantial.”

“I disagree,” states Tara Wirth. “That position is too ‘bottom line’ oriented. It’s not fair to delay payments only to suppliers who don’t charge interest for late payments. Most suppliers in that category are ones we have dealt with for years; selecting these suppliers would be taking advantage of the excellent relationships we have developed over the years. The fair thing to do is to make pro-rata payments to each supplier.”

“Well, making pro-rata payments to each supplier means that all our suppliers will be upset because no one receives full payment,” comments Sue Myling. “I believe it is most important to maintain good relations with our long-term suppliers; we should pay them currently and delay payments to our newer suppliers. The interest costs we end up paying these newer suppliers is the price we must pay to keep our long-term relationships solid.”

Points to Discuss:

1. What are the pros and cons of each alternative action plan available to Anton Corporation?
2. Which of the options do you feel is the most appropriate/ethical and why?
3. Assuming that Anton Corporation follows your suggestion, please describe actions that they can take to minimize the negative consequences of their choice. Please also describe how those particular actions will help. (Note: You must list at least 2 discrete actions for full credit).

DELIVERABLE: Please submit the following through Moodle:

1. A 2-3 paragraph response to the items listed above. Please submit your responses in a Microsoft Word document (.doc or .docx file extension). Written responses should be thoughtful, organized, and follow appropriate grammar rules. A rubric for the assignment is found on Pages 2-3.

our work will be graded on both your discussion of the questions related to the scenario (critical thinking) and your writing (rhetorical elements), with 80% of the grade coming from critical thinking and 20% from the rhetorical elements.

Answer rating: 100% (QA)

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