The Waldorf Manufacturing Company manufactures widgets

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The Waldorf Manufacturing Company manufactures widgets. The company has reported at least a small profit since the company began business over 30 years ago. Management prides itself on this excellent accomplishment and believes one significant contributing factor is the company's incentive plan that rewards top management a bonus equal to a percentage of operating income if the operating income goal for the year is achieved. However, 2020 has been a tough year, to say the least, and prospects for attaining the income goal for the year are bleak.  Josiah Sawgrass, CPA, the company's chief financial officer, has determined a way to increase December sales by an amount sufficient to boast operating income over the goal for the year and secure bonuses for all top management. A reputable customer ordered $250,000 of normally stocked widgets to be shipped on January 5, 2021. Josiah told the rest of the top management, I know we can get that order ready by December 31. We can then just leave the order on the loading dock until shipment. I see nothing wrong with recognizing the sale in 2020 since the widgets will have been a manufacturer, and we do have a firm order from a reputable customer. The company's nornmal procedure is to ship goods f.o.b. destination and recognize sales revenue when the customer receives the widgets. 

Questions

1. What philosophical, ethical level is Josiah, the CFO, operating at in the situation?
2. Is this earnings management appropriate in this situation?
3. Evaluate this case using the integrated ethical framework 4 steps, p. 84. 
4. What would you do if you were Josiah, the CFO (back it up with course material or scripture).