Exam 15: Sustainability

Which of the following items represent physical information in an environmental management accounting system?

Rubber City Cycles manufactures carbon fiber bicycle frames for professional racing and avid amateur cyclists.Rubber City has found a CNC (computer numerical control)machine that will significantly reduce manufacturing waste while improving the quality of the frames.The new CNC machine will increase annual fixed costs by $13,750,but will decrease variable cost per unit by $150.Rubber City expects to sell 750 frames next year. Annual data for the current system are as follows: By what amount will the breakeven point in dollars increase (decrease)if Rubber City purchases the new CNC machine?

Government grants and tax credits increase the costs of implementing sustainability measures.

Environmental management accounting (EMA)utilizes three types of information for internal decision making.

When it comes to developing an EMA system,there are few reference tools available for environmental management accountants;therefore,organizations are still working to discover what information they need and how it can be reported in an accurate,timely and relevant manner.This scenario is an example of which type of EMA implementation challenge?

For maximum effectiveness sustainable strategies are often implemented at which stage of an organization's value chain?

Walker Corporation's current accounting system does not include an estimate of the cost of lost sales resulting from poor environmental performance.This scenario is an example of which type of EMA implementation challenge?

Implementing sustainable business practices may help an organization to grow its market share.

The new managerial accountant at the Recycle Shoppe proposed a method to eliminate waste,recycle a variety of products to enhance sales,and generate profits.The operations manager attended a meeting with the creative manager and proposed that the staff recycle the wood out of the 1,000 old chairs in the warehouse and convert the wood backing into custom picture frames.The operations manager stated that the old wooden chairs in the basement are a fire hazard.The managerial accountant believes that the cost to convert the old wood into custom picture frames is $75,000.The managerial accountant forecasts earnings from the sale of the custom picture frames at $50,000. Compute the payback period,in years.Which of the following illuminates both internal and external costs to give the manager a complete set of information about how to generate cost-effective solutions to environmental and social concerns?

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

________ may include shareholders,bankers,special interest groups,employees,policy makers,customers,suppliers,or community members.

What are the three elements of the "triple bottom line"?

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?

There are several reasons an organization might pursue sustainable initiatives."A national hotel chain instituted a paper-saving program that reduced the cost of office paper purchased by 20% annually." This situation is an example of which type of reason to implement sustainable initiatives?

(Net present value table required)Alexander Industries,in Chicago,plans to take advantage of the winds blowing in from Lake Michigan.Alexander is developing a project to install a wind turbine that would generate electricity and reduce energy costs.The turbine would have an initial cost of $500,000 and would provide a net cost savings of $57,000 per year.The turbine will have a life of 25 years. If Alexander assigns a discount rate of 10% to this project,what is the net present value (NPV)of the wind turbine?

Gluck Metal Works stamps sheet metal into blanks that are used in a variety of consumer products.The average cost for sheet metal is $75 per ton.Gluck's waste disposal company charges $50 per ton to dispose of manufacturing waste.The stamping process currently employed by Gluck generates an average of 120 tons of waste per month. Gluck has developed a new system that would increase the efficiency of its stamping process.The new system has an annual cost of $45,000,but would reduce stamping waste by 50%,the remaining waste would be sold to a recycler for $30 per ton.What is the net savings if Gluck implements this new system?

Which of the following items do not represent monetary information in an environmental management accounting system?

Traditional performance management systems can be adapted to include measures of environmental costs,savings,and liabilities.The percentage of employees participating in a diabetes walk is an example of a key performance indicator (KPI)classified under which perspective of the balanced scorecard?

Traditional performance management systems can be adapted to include measures of environmental costs,savings,and liabilities.Revenue received from recycling scrap metal at a manufacturing plant is an example of a key performance indicator (KPI)classified under which perspective of the balanced scorecard?

The "triple bottom line" reports on three factors: profits,people,and planet.