pm scma environmental accounting

Question 1

what is environmental accounting

Answer 1

Environmental accounting is a comprehensive approach to accounting that integrates environmental costs and considerations into traditional financial and management accounting practices.

Question 2

what are the reasons for identifying environmental costs

Answer 2

• there are regulations and legislation that its imposed on busineses
• information on environmental costs can help in cost reduction and control schemes
• information on environmental costs can aid in pricing decisions

Question 3

what is the steps for environmental cost managements

Answer 3

1. identifications- there are a range of cost definitions
2. measurement - some costs may be hidden or difficult to separately identify
3. control- this can only happen if costs have nbenn correctly identified

Question 4

what are the different cost classification

Answer 4

1. conventional costs- raw materials and energy
2. potentially hidden costs
3. contingent costs- Contingent costs are potential costs that may or may not be incurred depending on the occurrence of certain future events e.g fines
4. image and relationship costs - costs of preparing environmental reports
5. environment protection costs - pollution reduction costs e.g innovation to overcome this , rnd for this
6. wasted material, capital and labour costs - production inefficiencies

Question 5

what is input/ output analysis

Answer 5

all inputs should lead to the expected outputs, if the difference is not what is estimated there may be high waste from the production process or potential fraud

e.g when car gets old, it is less fuel efficient

Question 5

what is environmental management accounting

Question 6

what is flow cost accounting

Answer 6

monitors the flow of material through a business into 3 categories and aims to reduce the quantity oof material in each category :

1. material
2. system and delivery
3. disposal

Question 7

what is environmental ABC

Answer 7

Environmental Activity-Based Costing (Environmental ABC) is an extension of traditional Activity-Based Costing (ABC) that focuses on identifying and allocating environmental costs to specific activities, products, or services within an organization. It aims to provide a more accurate picture of the environmental costs associated with different business processes, thereby helping organizations improve their environmental performance and make more informed decisions.

Question 8

what is life cycle costing ?

Answer 8

Life cycle costing (LCC) is a method of cost accounting that considers all costs associated with the life cycle of a product, system, or asset, from its initial acquisition through its operation, maintenance, and eventual disposal.