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Chapter 15 Sustainability
Chapter 15
Sustainability
Quick Check
Answers:
QC-1. c
QC-3. b
QC-5. c
QC-7. b
QC-9. d
QC-2. a
QC-4. d
QC-6. d
QC-8. a
QC-10. d
Short Exercises
(5 min.) S15-1
a. Attracting capital
(5 min.) S15-2
Aspect
Category
a.
Anti-competitive behavior
Social
b.
Economic performance
Economic
c.
Product and service labeling
Social
d.
Market presence
Economic
e.
Diversity and equal opportunity
Social
f.
Materials
Environmental
g.
Customer privacy
Social
h.
Emissions
Environmental
i.
Training and education
Social
j.
Energy
Environmental
k.
Employment
Social
l.
Customer health and safety
Social
m.
Effluents and waste
Environmental
n.
Forced or compulsory labor
Social
o.
Supplier human rights assessment
Social
p.
Supplier assessment for impacts on society
Social
q.
Indirect economic impacts
Economic
Copyright © 2015 Pearson Education, Inc.
15-3
1. NA
3. M
5. M
7. NA
9. NA
11. M
13. M
15. M
1. D. Historical orientation of accounting
3. B. Hidden cost
5. E. Newness of EMA
1. A Corporate Social Responsibility (CSR) report is also known as a(n) sustainability report.
3. The G4 guidelines were developed by the Global Reporting Initiative, a non-profit organization whose mission is to
help to standardize sustainability reporting practices.
5. The impact of the Deepwater Horizon (BP) oil spill on ecosystems in and around the Gulf of Mexico is an example
of a(n) External cost.
7. When the Big Four accounting firm of Deloitte validated UPS’s sustainability report, Deloitte was providing
assurance.
9. Sustainability is often defined as the ability to meet the needs of the present without compromising the ability of
Copyright © 2015 Pearson Education, Inc.
15-5
(10-15 min.) E15-9A
a. Economic
b. Environmental
c. Societal
(10-15 min.) E15-10A
a. R & D
b. Design
c. Customer service
(10-15 min.) E15-11A
Req. 1
Total of job:
Virgin materials
90
$ 4.10
$ 369
Recycled-content materials
210
$ 3.20
$ 672
Direct labor
17
$ 20.00
$ 340
Manufacturing overhead
17
$ 11.00
$ 187
Total cost of job
$ 1,568
Req. 2
Virgin materials
90
Recycled-content materials
210
70%
Total pounds
300
Managerial Accounting 4e Solutions Manual
(continued ) E15-17A
Req. 2
Doyle Beverages
Direct Materials Budget
For quarters 1 through 4
Quarter 1
Quarter 2
Quarter 3
Quarter 4
Total
Units to be produced
2,000,000
2,500,000
3,000,000
3,100,000
10,600,000
x Quantity of DM needed per unit
0.003
0.003
0.003
0.003
0.003
Quantity of PET needed for
production
6,000
7,500
9,000
9,300
31,800
Plus: Desired ending inventory
750
900
930
1,770
1,770
Total quantity needed
6,750
8,400
9,930
11,070
33,570
Less: Beginning inventory of DM
(800)
(750)
(900)
(930)
(800)
Quantity to purchase
5,950
7,650
9,030
10,140
32,770
x Cost per kilogram
$1.20
$1.20
$1.20
$1.20
$1.20
Total cost of DM purchases
$7,140
$9,180
$10,836
$12,168
$39,324
Req. 3
Q1
Q2
Q3
Q4
Total
Savings from reducing PET content of each
bottle
$1,060
$1,020
$1,204
$762
$4,046
Total Savings for the year – Cost of retrofitting the molds = Difference
$4,046 - $3,086 = $960
The company should make the change because the total of the savings is more than the cost of retrofitting the molds.
Copyright © 2015 Pearson Education, Inc.
15-15
1. The payback method is only focusing on time, not on profitability.
2. The payback period is not considering the cash inflows that occur after that period.
Note: Student answers will vary.
2. Investing -
4. Investing -
6. Financing -
8. Investing -
10. Operating -
(10-15 min.) E15-22A
a. Economic
b. Environmental
c. Economic
Copyright © 2015 Pearson Education, Inc.
15-16
(10-15 min.) E15-23B
a. Society
b. Environmental
c. Society
(10-15 min.) E15-24B
a. Marketing
(10-15 min.) E15-25B
Req. 1
Total of job:
Virgin materials
60
$ 3.70
$ 222
Recycled-content materials
140
$ 3.50
$ 490
Direct labor
15
$ 13.00
$ 195
Manufacturing overhead
15
$ 9.00
$ 135
Total cost of job
$ 1,042
Req. 2
Virgin materials
60
Recycled-content materials
140
70%
Total pounds
200
Chapter 15 Sustainability
