Exam 15: Sustainability

Which of the following items does not represent physical information in an environmental management accounting system?

Simon Manufacturing is conducting preliminary research into installing a geothermal heat pump to heat and cool its factories and offices. The initial cost of installing the new system is $245,000; however, Simon will save $35,000 annually on its heating and cooling costs. The system has an expected life of 15 years. What is the net present value (NPV)of the project, assuming a discount rate of 8%?

When Doubletree Hotel in Oregon created a "green" floor, it saw decreased housekeeping costs, laundry costs, and personal consumables costs. This situation is an example of which type of reason to implement sustainable initiatives?

An organization faces many challenges when implementing an environmental accounting (EMA)system. Which of the following inherent challenges must an organization overcome because its technical staff and accounting staff are in two separate locations, using two separate information systems?

A common definition of ________ is the ability to meet the needs of the present without compromising the ability of future generations to meet their own needs.

Sustainability is concerned not only with the impact on the environment, but also with the impact on people and profit. The "triple bottom line" measures an entity's impact on profit, people, and planet. A Fortune 500 company that encourages its employees to use reusable mugs as opposed to styrofoam cups is impacting which element of the triple bottom line?

Materials costs of product outputs category is similar to indirect materials since it becomes part of the final product.

Communication between environmental, production, and accounting staff is crucial for an EMA system to function effectively.

For maximum impact, a firm should initially focus on pollution control and cleanup measures.

The total volume of water use associated with the processes and products of a business is

Serenity Now Industries manufactures custom fiberglass hulls for luxury yachts and pleasure boats. The current cost accounting system uses machine hours to allocate manufacturing overhead to each job. Serenity estimates that in the coming year it will incur $600,000 in manufacturing overhead costs and use 8,000 machine hours. Depending on the specifications requested by the customer, the hull may use hazardous chemicals that incur greater disposal costs. Serenity's traditional accounting system includes the cost of hazardous waste disposal in with total manufacturing overhead. Serenity is planning to implement an activity based costing system to more accurately assign hazardous waste disposal costs to each job. Expected usage and costs for manufacturing overhead are as follows: During the year, Yacht #633 was started and completed: Requirements: a. Calculate the cost of Yacht #633 using the Serenity's current method of allocating manufacturing overhead. b. Calculate the cost of Yacht #633 using the proposed activity based costing system. How is this information useful to an environmental management accounting (EMA)system?

Which of the following organizations are continually working to develop and improve environmental reporting standards?

Sustainability is concerned not only with the impact on the environment, but also with the impact on people and profit. The "triple bottom line" measures an entity's impact on profit, people, and planet. A local accounting firm that participates in Habitat for Humanity is impacting which element of the triple bottom line?

Sustainability is an expense item only. An organization choosing sustainability will see reduced profits.

Which of the following is not an example of a cost reduction reason to support environmental sustainability?

The cost to install equipment to reduce the emissions of a coal-fired power plant would be categorized as what type of cost by an environmental management accounting system (EMA)?

Traditional performance management systems can be adapted to include measures of environmental costs, savings, and liabilities. The amount of electricity used by an oil refinery is an example of a key performance indicator (KPI)classified under which perspective of the balanced scorecard?

The role of accounting in sustainability is limited to mandatory external reporting.

Which of the following organizations has developed a Connected Reporting Framework (CRF)to be used to provide information for internal and external use?

There are several reasons an organization might pursue sustainable initiatives. "As a result of significant increase in the number of non-compliance notices it received in a recent year, an organization increased sustainability training and focused management attention on sustainability." This situation is an example of which type of reason to implement sustainable initiatives?