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Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787 Exercise 52
ENVIRONMENTAL FINANCIAL REPORT
The following environmental cost reports for 2009, 2010, and 2011 (year end December 31) are for the Communications Products Division of Kartel, a telecommunications company. In 2009, Kartel committed itself to a continuous environmental improvement program, which was implemented throughout the company.
At the beginning of 2011, Kartel began a new program of recycling nonhazardous scrap. The effort produced recycling income totaling $25,000. The marketing vice president and the environmental manager estimated that sales revenue had increased by $200,000 per year since 2009 because of an improved public image relative to environmental performance. The company's Finance Department also estimated that Kartel saved $80,000 in 2011 because of reduced finance and insurance costs, all attributable to improved environmental performance. All reductions in environmental costs from 2009 to 2011 are attributable to improvement efforts. Furthermore, any reductions represent ongoing savings.
Required:
1. Prepare an environmental financial statement for 2011 (for the Products Division). In the cost section, classify environmental costs by category (prevention, detection, etc.).
2. Evaluate the changes in environmental performance.
The following environmental cost reports for 2009, 2010, and 2011 (year end December 31) are for the Communications Products Division of Kartel, a telecommunications company. In 2009, Kartel committed itself to a continuous environmental improvement program, which was implemented throughout the company.
At the beginning of 2011, Kartel began a new program of recycling nonhazardous scrap. The effort produced recycling income totaling $25,000. The marketing vice president and the environmental manager estimated that sales revenue had increased by $200,000 per year since 2009 because of an improved public image relative to environmental performance. The company's Finance Department also estimated that Kartel saved $80,000 in 2011 because of reduced finance and insurance costs, all attributable to improved environmental performance. All reductions in environmental costs from 2009 to 2011 are attributable to improvement efforts. Furthermore, any reductions represent ongoing savings.
Required:
1. Prepare an environmental financial statement for 2011 (for the Products Division). In the cost section, classify environmental costs by category (prevention, detection, etc.).
2. Evaluate the changes in environmental performance.
Explanation
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1.
Environmental financial statement fo...
Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
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