ETHICAL OBLIGATIONS AND DECISION
MAKING IN ACCOUNTING TEXT AND CASES
COMPREHENSIVE STUDY SHEET 2026 SOLVED
QUESTIONS PREMIUM BUNDLE
◉ System 1 Thinking.
Answer: intuitive system of processing information: fast, automatic,
effortless, and emotional decision processes
◉ System 2 Thinking.
Answer: slower, conscious, effortful, explicit, and a more reasoned
decision process.
◉ Cognitive Errors (Shortcomings).
Answer: the tangible and the abstract, loss aversion, framing, and
overconfidence
◉ The Tangible & The Abstract.
Answer: when people make ethically tinged decisions, they tend to
consider immediate and tangible factors at the expense of more
removed and abstract factors.
,◉ Loss Aversion.
Answer: people have a tendency to detest losses even more than
they enjoy gains so that they make more immoral decisions to avoid
what they perceive to be a potential loss.
◉ Framing.
Answer: people have a tendency to make different decisions based
upon how a question is framed so that other factors are framed as
more important than ethical standards.
◉ Overconfidence.
Answer: People have a tendency to believe that they are more ethical
than they actually are, which can cause them to make decisions with
serious ethical implications without proper reflection.
◉ Incrementalism.
Answer: may influence the behavior of even well-intentioned people
who find themselves in situations in which ethical corners are being
cut. it can be difficult to notice gradual changes in one's environment
so that cutting corners grow until violations of the law occur.
◉ Social and Organizational Pressures.
Answer: tendencies to be overly obedient to authority and to
conform excessively to the ethical judgements and actions to peers
, ◉ Situational Factors.
Answer: influence ethical decision making and the actor may not
even be aware of the effect.
◉ Cognitive Dissonance.
Answer: inconsistency between our thoughts, beliefs, or attitudes
and our behavior creates the need to resolve contradictory or
conflicting beliefs, values, and perceptions.
◉ How to reduce dissonance? (Festinger).
Answer: change one or more of the attitudes, behavior, or beliefs so
as to make the relationship between the two elements a consonant
one
acquire new information that outweighs the dissonant beliefs
reduce the importance of the cognitions
◉ Cognitive Biases.
Answer: beliefs or thoughts about the world, other people, and
ourselves which can negatively influence our decision-making
process.
MAKING IN ACCOUNTING TEXT AND CASES
COMPREHENSIVE STUDY SHEET 2026 SOLVED
QUESTIONS PREMIUM BUNDLE
◉ System 1 Thinking.
Answer: intuitive system of processing information: fast, automatic,
effortless, and emotional decision processes
◉ System 2 Thinking.
Answer: slower, conscious, effortful, explicit, and a more reasoned
decision process.
◉ Cognitive Errors (Shortcomings).
Answer: the tangible and the abstract, loss aversion, framing, and
overconfidence
◉ The Tangible & The Abstract.
Answer: when people make ethically tinged decisions, they tend to
consider immediate and tangible factors at the expense of more
removed and abstract factors.
,◉ Loss Aversion.
Answer: people have a tendency to detest losses even more than
they enjoy gains so that they make more immoral decisions to avoid
what they perceive to be a potential loss.
◉ Framing.
Answer: people have a tendency to make different decisions based
upon how a question is framed so that other factors are framed as
more important than ethical standards.
◉ Overconfidence.
Answer: People have a tendency to believe that they are more ethical
than they actually are, which can cause them to make decisions with
serious ethical implications without proper reflection.
◉ Incrementalism.
Answer: may influence the behavior of even well-intentioned people
who find themselves in situations in which ethical corners are being
cut. it can be difficult to notice gradual changes in one's environment
so that cutting corners grow until violations of the law occur.
◉ Social and Organizational Pressures.
Answer: tendencies to be overly obedient to authority and to
conform excessively to the ethical judgements and actions to peers
, ◉ Situational Factors.
Answer: influence ethical decision making and the actor may not
even be aware of the effect.
◉ Cognitive Dissonance.
Answer: inconsistency between our thoughts, beliefs, or attitudes
and our behavior creates the need to resolve contradictory or
conflicting beliefs, values, and perceptions.
◉ How to reduce dissonance? (Festinger).
Answer: change one or more of the attitudes, behavior, or beliefs so
as to make the relationship between the two elements a consonant
one
acquire new information that outweighs the dissonant beliefs
reduce the importance of the cognitions
◉ Cognitive Biases.
Answer: beliefs or thoughts about the world, other people, and
ourselves which can negatively influence our decision-making
process.
