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In: Finance

st year, the McJellyBelly Corporation provided the American Red Cross $5 million targeted for the Boulder/Longmont/Lyons,...

st year, the McJellyBelly Corporation provided the American Red Cross $5 million targeted for the Boulder/Longmont/Lyons, Colorado area which will need funds to help this area recover from the natural disaster that struck there. From a Corporate social responsibility standpoint, we would consider these funds as ___________________.
A. Corporate policy C. Taxation without representation
B. Corporate philanthropy D. Compliance funds

Solutions

Expert Solution

The Correct answer here would be option B. Corporate Philanthrophy. Corporate Philanthrophy means when a organization or corporate is giving any donation to any other organization for a greater good or for a cause e.g To fight aganist any disaster or wellfare of the public in the large hence, option B would be the right answer here and such funds must be considered under this category.

Option A would be a wrong option as CSR activities do not fall under coporate policy as its a guidline for running a business. It guides on how you are going to conduct with your shareholders, directors, employees and other third parties who are interested in your business.

Again, we won't go with option C as well as "Taxation without representation" means where in you pay taxes to the ferderal Government without having any say about the government policies. So, these funds cannot be allocated or subcategorised under such category.

Lastly, compliance funds are basically used by the compliance department in an organization to meet up with the regulatorty and legal requirements e.g. Fighting any law suit and others.These funds ensure the organization has a proper internal control and are adherent to external regulations and policies. Thus, option D would not be the right option as well.


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