Your small manufacturing company is in serious financial difficulty
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Your small manufacturing company is in serious financial difficulty

Your small manufacturing company is in serious financial difficulty. A large order of your products is ready to be delivered to a key customer when you discover that the product is simply not right. It will not meet all performance specifications, will cause problems for your customer, and will require rework in the field; however, this, you know, will not become evident until after the customer has received and paid for the order. If you do not ship the order and receive the payment as expected, your business may be forced into bankruptcy. And if you delay the shipment or inform the customer of these problems, you may lose the order and also go bankrupt. What would you do?

(a) I would not ship the order and place my firm in voluntary bankruptcy.

(b) I would inform the customer and declare voluntary bankruptcy.

(c) I would ship the order and inform the customer, after I received payment.

(d) I would ship the order and not inform the customer.

Hint
ManagementVoluntary bankruptcy is a form of bankruptcy when an insolvent debtor submits a petition to the court after realizing they are unable to clear a debt other than waiting to be forced to be declared bankrupt. It mostly occurs when a debtor is unable to come to an agreement with the creditor hence they decide to surrender to the court for legal approval of bankruptcy....

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