Maurice Tutor

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Teaching Since: May 2017
Last Sign in: 402 Weeks Ago, 6 Days Ago
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  • MCS,PHD
    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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  • Professor
    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 22 Jul 2017 My Price 13.00

ENVIRONMENTAL COST ASSIGNMENT

ENVIRONMENTAL COST ASSIGNMENT

Coyle 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:

Pounds produced

7,500,000

 

18,750,000

Packaging materials (pounds)

2,250,000

 

1,125,000

Energy usage (kilowatt-hours)

750,000

 

375,000

Toxic releases (pounds into air)

1,875,000

 

375,000

Pollution control (machine hours)

300,000

 

75,000

Costs of activities:

 

 

 

Using packaging materials

 

$3,375,000

 

Using energy

 

900,000

 

Releasing toxins (fines)

 

450,000

 

Operating pollution control equipment

 

1,050,000

 

Required:

1. Calculate the environmental cost per pound for each product. 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 $2,025,000 per year. How would assignment of these costs change the unit cost? Should they be assigned?

Answers

(5)
Status NEW Posted 22 Jul 2017 09:07 PM My Price 13.00

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