Question:
Ace is a CMA working in a new assignment as an assistant to Sally, the head manager of a production department. Ace notices the department has over-applied factory overhead in each of the last ten years. Ace asks Sally about the pattern and is reminded that bonuses depend on meeting budgets and that Ace should not question estimates used by Sally.
a. Why would the manager do this?
b. What is the harm to the company?
c. What should Ace do, and why?
d. What actions should Ace avoid, and why?