Waurika Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of two of its most wide-selling anti-cancer drugs. The controller and environmental manager have identified the following environmental activities and costs associated with the two products: Org AB 4,950,000 1,650,000 550,000 Pounds produced Packaging materials (pounds) Energy usage (kilowatt-hours) Toxin releases (pounds into air) Pollution control (machine hours) Costs of activities: Using packaging materials Using energy Releasing toxins (fines) Operating pollution control equipment 825,000 110,000 $2,200,000 330,000 330,000 660,000 Org XY 13,750,000 550,000 385,000 440,000 55,000
Waurika Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of two of its most wide-selling anti-cancer drugs. The controller and environmental manager have identified the following environmental activities and costs associated with the two products: Org AB 4,950,000 1,650,000 550,000 Pounds produced Packaging materials (pounds) Energy usage (kilowatt-hours) Toxin releases (pounds into air) Pollution control (machine hours) Costs of activities: Using packaging materials Using energy Releasing toxins (fines) Operating pollution control equipment 825,000 110,000 $2,200,000 330,000 330,000 660,000 Org XY 13,750,000 550,000 385,000 440,000 55,000
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 23E: Coyle Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of...
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Question
![Required:
1. Calculate the environmental cost per pound for each product. Round your calculations and answers to four decimal places.
Unit Cost Per Pound
Org AB
Org XY
Which of the two products appears to cause the most degradation to the environment?
2. In which environmental category would you classify excessive use of materials and energy?
3. Suppose that the toxin releases cause health problems for those who live near the chemical plant. The costs, due to missed work and medical
treatments, are estimated at $1,430,000 per year. How would assignment of these costs change the unit cost? Round your calculations and
answers to three decimal places.
Org AB
Org XY
by
by
Unit Cost
100](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8f10230f-de28-4b13-be4f-040d677e1c39%2Fdb798b5c-d9a9-4155-8594-b0e7324053e6%2Faku9x1_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required:
1. Calculate the environmental cost per pound for each product. Round your calculations and answers to four decimal places.
Unit Cost Per Pound
Org AB
Org XY
Which of the two products appears to cause the most degradation to the environment?
2. In which environmental category would you classify excessive use of materials and energy?
3. Suppose that the toxin releases cause health problems for those who live near the chemical plant. The costs, due to missed work and medical
treatments, are estimated at $1,430,000 per year. How would assignment of these costs change the unit cost? Round your calculations and
answers to three decimal places.
Org AB
Org XY
by
by
Unit Cost
100
![Environmental Cost Assignment
Waurika Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of two of its most wide-selling anti-cancer
drugs. The controller and environmental manager have identified the following environmental activities and costs associated with the two products:
Org AB
Pounds produced
Packaging materials (pounds)
Energy usage (kilowatt-hours)
Toxin releases (pounds into air)
Pollution control (machine hours)
Costs of activities:
Using packaging materials
Using energy
Releasing toxins (fines)
Operating pollution control equipment
4,950,000
1,650,000
550,000
825,000
110,000
$2,200,000
330,000
330,000
660,000
Org XY
13,750,000
550,000
385,000
440,000
55,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8f10230f-de28-4b13-be4f-040d677e1c39%2Fdb798b5c-d9a9-4155-8594-b0e7324053e6%2Fps35yug_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Environmental Cost Assignment
Waurika Pharmaceuticals produces two organic chemicals (Org AB and Org XY) used in the production of two of its most wide-selling anti-cancer
drugs. The controller and environmental manager have identified the following environmental activities and costs associated with the two products:
Org AB
Pounds produced
Packaging materials (pounds)
Energy usage (kilowatt-hours)
Toxin releases (pounds into air)
Pollution control (machine hours)
Costs of activities:
Using packaging materials
Using energy
Releasing toxins (fines)
Operating pollution control equipment
4,950,000
1,650,000
550,000
825,000
110,000
$2,200,000
330,000
330,000
660,000
Org XY
13,750,000
550,000
385,000
440,000
55,000
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