Environmental Cost Report Verde Company reported operating costs of $56,000,000 as of December 31, 20x5, with the following environmental costs: Testing for contamination $ 672,000 Inspecting products 1,008,000 Treating toxic waste 2,352,000 Obtaining ISO 14001 certification 840,000 Designing processes 784,000 Cleaning up oil spills 4,200,000 Maintaining pollution equipment 1,008,000 Cleaning up contaminated soil 6,216,000 Required: 1. Prepare an environmental cost report, classifying costs by quality category and expressing each as a percentage of total operating costs. Round percentages to two decimal places, if rounding is required. For example, 5.79% would be entered as "5.79". Verde Company Environmental Cost Report For the Year Ended December 31, 20x5 Environmental Cost Total Environmental Cost Percentage of Operating Costs Prevention costs: $fill in the blank 6b95f0094fe707f_2 fill in the blank 6b95f0094fe707f_4 $fill in the blank 6b95f0094fe707f_5 fill in the blank 6b95f0094fe707f_6% Detection costs: $fill in the blank 6b95f0094fe707f_8 fill in the blank 6b95f0094fe707f_10 fill in the blank 6b95f0094fe707f_11 fill in the blank 6b95f0094fe707f_12% Internal failure costs: $fill in the blank 6b95f0094fe707f_14 fill in the blank 6b95f0094fe707f_16 fill in the blank 6b95f0094fe707f_17 fill in the blank 6b95f0094fe707f_18% External failure costs: $fill in the blank 6b95f0094fe707f_20 fill in the blank 6b95f0094fe707f_22 fill in the blank 6b95f0094fe707f_23 fill in the blank 6b95f0094fe707f_24% Total quality costs $fill in the blank 6b95f0094fe707f_25 fill in the blank 6b95f0094fe707f_26% 2. What if Verde deliberately did not include the cost of damaging the ecosystem because of solid waste disposal in its environmental cost report? What is the most likely reason?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Environmental Cost Report

Verde Company reported operating costs of $56,000,000 as of December 31, 20x5, with the following environmental costs:

Testing for contamination	$ 672,000
Inspecting products	1,008,000
Treating toxic waste	2,352,000
Obtaining ISO 14001 certification	840,000
Designing processes	784,000
Cleaning up oil spills	4,200,000
Maintaining pollution equipment	1,008,000
Cleaning up contaminated soil	6,216,000

Required:

1. Prepare an environmental cost report, classifying costs by quality category and expressing each as a percentage of total operating costs. Round percentages to two decimal places, if rounding is required. For example, 5.79% would be entered as "5.79".

Verde Company
Environmental Cost Report
For the Year Ended December 31, 20x5
	Environmental Cost	Total Environmental Cost	Percentage of Operating Costs
Prevention costs:
	$fill in the blank 6b95f0094fe707f_2
	fill in the blank 6b95f0094fe707f_4	$fill in the blank 6b95f0094fe707f_5	fill in the blank 6b95f0094fe707f_6%
Detection costs:
	$fill in the blank 6b95f0094fe707f_8
	fill in the blank 6b95f0094fe707f_10	fill in the blank 6b95f0094fe707f_11	fill in the blank 6b95f0094fe707f_12%
Internal failure costs:
	$fill in the blank 6b95f0094fe707f_14
	fill in the blank 6b95f0094fe707f_16	fill in the blank 6b95f0094fe707f_17	fill in the blank 6b95f0094fe707f_18%
External failure costs:
	$fill in the blank 6b95f0094fe707f_20
	fill in the blank 6b95f0094fe707f_22	fill in the blank 6b95f0094fe707f_23	fill in the blank 6b95f0094fe707f_24%
Total quality costs		$fill in the blank 6b95f0094fe707f_25	fill in the blank 6b95f0094fe707f_26%

2. What if Verde deliberately did not include the cost of damaging the ecosystem because of solid waste disposal in its environmental cost report? What is the most likely reason?

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