Purchase Solution

Ethical Dilemma - Allocation to achieve fairness

Not what you're looking for?

Ask Custom Question

Ethical Dilemma - Allocation to achieve fairness
The American Acupuncture Association offers continuing professional education courses for its members at its annual meeting. Instructors are paid a fee for each student attending their courses but are charged a fee for overhead costs that is deducted from their compensation. Overhead costs include fees paid to rent instructional equipment such as overhead projectors, provide supplies to participants, and offer refreshments during coffee breaks. The number of courses offered is used as the allocation base for determining the overhead charge. For example, if overhead costs amount to $5,000 and 25 courses are offered, each course is allocated an overhead charge of $200 ($5,000 ÷ 25 courses). Heidi McCarl, who taught one of the courses, received the following statement with her check in payment for her instructional services.
Instructional fees (20 students x $50 per student) $1,000
Less: Overhead charge (200)
Less: Charge for sign language assistant (400)
Amount due instructor $560

Although Ms. McCarl was well aware that one of her students was deaf and required a sign language assistant, she was surprised to find that she was required to absorb the cost of this service.
Required
a. Given that the Americans with Disabilities Act stipulates that the deaf student cannot be charged for the cost of providing sign language, who should be required to pay the cost of sign language services?
b. Explain how allocation can be used to promote fairness in distributing service costs to the disabled. Describe two ways to treat the $240 cost of providing sign language services that improve fairness.

Purchase this Solution

Solution Summary

Your response is 286 words and gives you two ways to handle the costs of disability accommodations that make it fair. An analogy is given for another cost to illustrate why this is fair. The nature of the disability costs are discussed and a sample computation is shown.

Solution Preview

a. Given that the Americans with Disabilities Act stipulates that the deaf student cannot be charged for the cost of providing sign language, who should be required to pay the cost of sign language services?

The sign language services should be part of the program cost. In other words, the service is a function of offering courses, not a function of having a deaf student in a particular course. In fact, the cost of all accommodations, not just signing assistants, is a program costs. These are equivalent to other variable overhead costs. Not all overhead costs are fixed, such as the cost of the facility or the ...

Solution provided by:
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
Recent Feedback
  • "hey just wanted to know if you used 0% for the risk free rate and if you didn't if you could adjust it please and thank you "
  • "Thank, this is more clear to me now."
  • "Awesome job! "
  • "ty"
  • "Great Analysis, thank you so much"
Purchase this Solution


Free BrainMass Quizzes
Lean your Process

This quiz will help you understand the basic concepts of Lean.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

Operations Management

This quiz tests a student's knowledge about Operations Management

Six Sigma for Process Improvement

A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.

Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.