Is behavior regarding cost information provided to unethical

Reference no: EM13258900

Farmer Frank's produces items from local farm products anddistributes them to supermarkets. Over the years, price competitionhas become increasingly important, so Susan Kramer, thecompany's controller, is planning to implement a standardcost system for Farmer Frank's. She asked her costaccountant, Margaret Chang, to gather cost information on theproduction of blueberry preserves (Farmer Frank's mostpopular product). Margaret reported that blueberries cost $.75 perquart, the price she intends to pay to her good friend who has beenoperating a blueberry farm that has been unprofitable for the lastfew years. Because of an oversupply in the market, the price forblueberries has dropped to $.60 per quart. Margaret is sure thatthe $.75 price will be enough to pull her friend's farm outof the red and into the black.

Required

Is Margaret's behavior regarding the cost information sheprovided to Susan unethical? Explain your answer.

Reference no: EM13258900

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