CAS 14 - Pollution Control Cost

Question 1

Definition

Answer 1

Cost of control of emission and effluence into the environment

Question 2

Principles of measurement

Answer 2

1. Total of direct and indirect cost
2. Future remediation or disposal cost- contract(legal) –accounted -based-expected pollution-given period of time or disposal in future
3. Contingent future remediation or disposal-not cost- until- certainly incurred- measured
4. In house pollution control activity- valued at materials,consumables,spares,manpower,equipment,
5. Contractors- inside- invoice + cost of resources
6. Contractors- outside- invoice+taxes and duties-refund

Question 3

General Principles

Answer 3

1. Finance cost is not included
2. Abnormal cost is not included
3. Imputed cost is included ( only materials)
4. Depreciation- based on benefit received
5. Credit or recoveries shall be reduced
6. Subsidy, grant or incentives shall be reduced
7. Penalties ,damages, fines paid to stat auth not cost
8. Cost-standard rates- variance is part of cost

Question 4

Assignment

Answer 4

1. Direct- Tracable to cost object- econ feasible manner
2. Indirect- a) Cause and effect
   b) Benefits received

Question 5

Presentation

Answer 5

1. If material - presented as separate cost item

Question 6

Disclosure

Answer 6

1. Basis of distribution
2. Std rates, price and usage variances
3. Abnormal cost is includable
4. Penalties, damages or fines paid to stat authorities
5. Subsidy, grant, incentives recvd is reduced
6. Related party transactions
7. Forex Transactions