Chris is a supervisor at Crystal Clear Technologies, a manufacturer of custom LCD display panels. Chris's performance is tied to ensuring job profitability.
As Job 4 nears completion, Chris notices that is has significant cost overruns. At the same time, Job 5 is on target to be profitable. Chris is therefore, considering moving costs from Job 4, which has cost overruns, to Job 5, so that both projects appear profitable.
a. Briefly explain the implications if Chris does this?
b. Why is this wrong?

Question

Chris is a supervisor at Crystal Clear Technologies, a manufacturer of custom LCD display panels. Chris's performance is tied to ensuring job profitability. 
As Job 4 nears completion, Chris notices that is has significant cost overruns. At the same time, Job 5 is on target to be profitable. Chris is therefore, considering moving costs from Job 4, which has cost overruns, to Job 5, so that both projects appear profitable.
a. Briefly explain the implications if Chris does this?
b. Why is this wrong?

Quizplus · Accepted Answer

The Answer of Chris is a supervisor at Crystal Clear Technologies, a manufacturer of custom LCD display panels. Chris's performance is tied to ensuring job profitability. 
As Job 4 nears completion, Chris notices that is has significant cost overruns. At the same time, Job 5 is on target to be profitable. Chris is therefore, considering moving costs from Job 4, which has cost overruns, to Job 5, so that both projects appear profitable.
a. Briefly explain the implications if Chris does this?
b. Why is this wrong?

Chris Is a Supervisor at Crystal Clear Technologies, a Manufacturer