The accountant of Astera Ltd has identified the following types of environmental costs for the business: Cleaning of exhaust fans at production sites Defective products and waste produced in manufacturing Development of water pollution monitoring systems Fine for leaking waste water into the local river Inspection of drainage systems Loss in sales due to poor environmental reputation Obtaining ISO 14001 certification Potential employee compensation for workplace injury Use of non-renewable resources in producing the product   Required: Classify each of the costs above into the five tiers of environmental costs. Identify one example of tier 3, tier 4 and tier 5 environmental cost that may have been overlooked.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter14: Quality And Environmental Cost Management
Section: Chapter Questions
Problem 28E: Environmental costs are those costs incurred because poor environmental quality exists or may exist....
icon
Related questions
Question

The accountant of Astera Ltd has identified the following types of environmental costs for the business:

  • Cleaning of exhaust fans at production sites
  • Defective products and waste produced in manufacturing
  • Development of water pollution monitoring systems
  • Fine for leaking waste water into the local river
  • Inspection of drainage systems
  • Loss in sales due to poor environmental reputation
  • Obtaining ISO 14001 certification
  • Potential employee compensation for workplace injury
  • Use of non-renewable resources in producing the product

 

Required:

  • Classify each of the costs above into the five tiers of environmental costs.
  • Identify one example of tier 3, tier 4 and tier 5 environmental cost that may have been overlooked.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Costing for Spoilage, rework and scrap
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College