High Country Stables, Inc

Essay

High Country Stables, Inc., operates several dog-racing tracks throughout the United States. Since most facilities are outdoor tracks only, most of the cash receipts for High Country are received from April through October. These funds are usually invested in temporary, very liquid investments, such as stocks and bonds. Among the stocks purchased last year, was Vendable, Inc. a company specializing in automatic vending equipment.
The company decided not to sell its Vendable stock at the end of last year, and has purchased more of the stock this year. The company intends to continue to purchase stock until it holds enough to make a takeover bid for the company. The accountants have been instructed to continue to classify the investment as temporary until the takeover is accomplished, so that less attention will be directed to it. (Presently, High Country has no long-term investment in stock at all.)
Required:
1. Is it ethical for High Country to attempt to take over another company? Explain.
2. Is it ethical for High Country to leave its investment in the temporary investment category? Explain.