Analysis of the Situation at Peters Inc.

by | Aug 14, 2023 | Accounting

 

Blake Romney became chief executive officer of Peters Inc. 2 years ago. At the time, the company was reporting lagging profits, and Blake was brought in to “stir things up.” The company has three divisions: electronics, fiber optics, and plumbing supplies. Blake has no interest in plumbing supplies, and one of the first things he did was to put pressure on his accountants to reallocate some of the company’s fixed costs away from the other two divisions to the plumbing division. This had the effect of causing the plumbing division to report losses during the last 2 years; in the past it had always reported low, but acceptable, net income. Blake felt that this reallocation would shine a favorable light on him in front of the board of directors because it meant that the electronics and fiber optics divisions would look like they were improving. Given that these are “businesses of the future,” he believed that the stock market would react favorably to these increases, while not penalizing the poor results of the plumbing division. Without this shift in the allocation of fixed costs, the profits of the electronics and fiber optics divisions would not have improved. But now the board of directors has suggested that the plumbing division be closed because it is reporting losses. This would mean that nearly 500 employees, many of whom have worked for Peters their whole lives, would lose their jobs.
Instructions
If a division is reporting losses, does that necessarily mean that it should be closed?
Was the reallocation of fixed costs across divisions unethical?
What should Blake do?

Sample solution

Dante Alighieri played a critical role in the literature world through his poem Divine Comedy that was written in the 14th century. The poem contains Inferno, Purgatorio, and Paradiso. The Inferno is a description of the nine circles of torment that are found on the earth. It depicts the realms of the people that have gone against the spiritual values and who, instead, have chosen bestial appetite, violence, or fraud and malice. The nine circles of hell are limbo, lust, gluttony, greed and wrath. Others are heresy, violence, fraud, and treachery. The purpose of this paper is to examine the Dante’s Inferno in the perspective of its portrayal of God’s image and the justification of hell. 

In this epic poem, God is portrayed as a super being guilty of multiple weaknesses including being egotistic, unjust, and hypocritical. Dante, in this poem, depicts God as being more human than divine by challenging God’s omnipotence. Additionally, the manner in which Dante describes Hell is in full contradiction to the morals of God as written in the Bible. When god arranges Hell to flatter Himself, He commits egotism, a sin that is common among human beings (Cheney, 2016). The weakness is depicted in Limbo and on the Gate of Hell where, for instance, God sends those who do not worship Him to Hell. This implies that failure to worship Him is a sin.


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God is also depicted as lacking justice in His actions thus removing the godly image. The injustice is portrayed by the manner in which the sodomites and opportunists are treated. The opportunists are subjected to banner chasing in their lives after death followed by being stung by insects and maggots. They are known to having done neither good nor bad during their lifetimes and, therefore, justice could have demanded that they be granted a neutral punishment having lived a neutral life. The sodomites are also punished unfairly by God when Brunetto Lattini is condemned to hell despite being a good leader (Babor, T. F., McGovern, T., & Robaina, K. (2017). While he commited sodomy, God chooses to ignore all the other good deeds that Brunetto did.

Finally, God is also portrayed as being hypocritical in His actions, a sin that further diminishes His godliness and makes Him more human. A case in point is when God condemns the sin of egotism and goes ahead to commit it repeatedly. Proverbs 29:23 states that “arrogance will bring your downfall, but if you are humble, you will be respected.” When Slattery condemns Dante’s human state as being weak, doubtful, and limited, he is proving God’s hypocrisy because He is also human (Verdicchio, 2015). The actions of God in Hell as portrayed by Dante are inconsistent with the Biblical literature. Both Dante and God are prone to making mistakes, something common among human beings thus making God more human.

To wrap it up, Dante portrays God is more human since He commits the same sins that humans commit: egotism, hypocrisy, and injustice. Hell is justified as being a destination for victims of the mistakes committed by God. The Hell is presented as being a totally different place as compared to what is written about it in the Bible. As a result, reading through the text gives an image of God who is prone to the very mistakes common to humans thus ripping Him off His lofty status of divine and, instead, making Him a mere human. Whether or not Dante did it intentionally is subject to debate but one thing is clear in the poem: the misconstrued notion of God is revealed to future generations.

 

References

Babor, T. F., McGovern, T., & Robaina, K. (2017). Dante’s inferno: Seven deadly sins in scientific publishing and how to avoid them. Addiction Science: A Guide for the Perplexed, 267.

Cheney, L. D. G. (2016). Illustrations for Dante’s Inferno: A Comparative Study of Sandro Botticelli, Giovanni Stradano, and Federico Zuccaro. Cultural and Religious Studies, 4(8), 487.

Verdicchio, M. (2015). Irony and Desire in Dante’s” Inferno” 27. Italica, 285-297.

Sample Answer

Sample Answer

 

Analysis of the Situation at Peters Inc.
If a division is reporting losses, does that necessarily mean that it should be closed?
No, the fact that the plumbing division is reporting losses does not necessarily mean that it should be closed. There could be various reasons for the division’s poor financial performance, such as temporary market conditions, mismanagement, or lack of investment. Closing the division without thoroughly analyzing the underlying causes and exploring potential solutions may not be the most prudent decision.

Was the reallocation of fixed costs across divisions unethical?
Yes, the reallocation of fixed costs by Blake Romney can be considered unethical. By shifting costs from the electronics and fiber optics divisions to the plumbing division, Blake artificially created losses in the plumbing division, which had previously been reporting acceptable net income. This manipulation was done solely to make the other divisions appear more profitable and to enhance Blake’s image in front of the board of directors. Such actions not only deceive stakeholders but also jeopardize the jobs of hundreds of employees who have dedicated their careers to Peters Inc.

What should Blake do?
Blake should rectify the unethical reallocation of fixed costs and address the issues in the plumbing division in an ethical and responsible manner. Rather than closing the division outright, Blake should focus on identifying and resolving the underlying problems causing the division’s losses. This may involve conducting a thorough analysis of its operations, evaluating market conditions, and implementing strategic changes to improve performance.

Additionally, Blake should consider involving the employees and their expertise in finding solutions. They may have valuable insights and suggestions for turning around the division’s financial situation. By respecting their contributions and involving them in decision-making processes, Blake can demonstrate good leadership and foster a sense of teamwork and commitment among employees.

Ultimately, Blake must prioritize the long-term success of Peters Inc. by ensuring ethical conduct, fair treatment of employees, and sustainable strategies for all divisions. This approach will lead to a more positive work environment, stronger stakeholder relationships, and ultimately, better financial results for the company as a whole.

 

 

 

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