Explore BrainMass

Explore BrainMass

    Ethics- Controlled Disbursing

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    P14-16

    ETHICS PROBLEM

    Controlled disbursing is defined as an information product?that is, the bank on which the company's checks are drawn provides an early-morning notification of the total dollar amount of checks that will clear the account that day. Based on that notification, the company may then fund the account for that amount by the close of business that afternoon. How might controlled disbursing still be viewed as a form of "remote disbursing," and therefore be considered unethical?

    © BrainMass Inc. brainmass.com June 3, 2020, 9:50 pm ad1c9bdddf
    https://brainmass.com/business/business-philosophy-and-ethics/ethics-controlled-disbursing-202028

    Solution Preview

    Industry as a whole is becoming increasingly competitive as firms find unique ways to both improve cash inflows as well as decrease costs. One unique cost often under addressed is opportunity cost. Opportunity costs are those funds forgone when a firm makes one decision at the expense of another. If a firm keeps large levels of cash in a non interest bearing checking account, these opportunity costs associated with this decision include all interest the company could ...

    Solution Summary

    The solution describes the ethical dillemma involved with controlled disbursement methods used by some banks.

    $2.19

    ADVERTISEMENT