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Copyright © 2015 Pearson Education, Inc.
15-26
(20-25 min.) P15-37A
Req. 1
First, select the highest volume (occupancy %) and the lowest volume (occupancy %).
Next, calculate the number of room days:
Cost
Activity
Variable cost:
High pt.
$37,339
93,075
January
Low pt.
$19,600
43,800
October
Difference
$17,739
49,275
Change in cost / change in volume = Variable cost of laundry per guest day
$17,739 / 49,275= $0.36
Req. 2
First, select the highest volume (occupancy %) and the lowest volume (occupancy %).
Next, calculate the number of room days:
Cost
Activity
Variable cost:
High pt.
$146,456
93,075
January
Low pt.
$75,500
43,800
October
Difference
$70,956
49,275
Change in cost / change in volume = Variable cost of housekeeping per guest day
$70,956/ 49,275 = $1.44
Req. 3
When using the high-low method, the variable cost of laundry per guest day is estimated to be $0.36 If guests are
given a $0.90 credit per day that linens are reused, the resort will not save anything per guest day. It does not appear
Copyright © 2015 Pearson Education, Inc.
15-27
Req. 5
Regression: LAUNDRY
SUMMARY OUTPUT
Req. 6
Regression: HOUSEKEEPING
SUMMARY OUTPUT
Managerial Accounting 4e Solutions Manual
(continued) P15-37A
P15-38A
Req. 1
Composite roof:
Year(s)
PV factor
PV
Cost
$ 1,600,000
Now
1
$ 1,600,000
Annual maintenance costs per year
$ 12,000
1-30
8.055
$ 96,660
Salvage value
$ 35,000
30
0.033
$ (1,155)
$ 1,695,505
Req. 2
Living roof:
Vegetation cost
$ 370,000
Now
1
$ 370,000
Waterproof membrane
$ 110,000
Now
1
$ 110,000
Growing medium
$ 170,000
Now
1
$ 170,000
Expert fee
$ 20,000
Now
1
$ 20,000
Construction costs
$ 690,000
Now
1
$ 690,000
Other miscellaneous fees
$ 370,000
Now
1
$ 370,000
Annual maintenance costs per year
$ 52,000
1-30
8.055
$ 418,860
Reduction in heating/cooling costs per year
$ 41,000
1-30
8.055
$ (330,255)
Reduction in storm water treatment costs per
year
$ 11,000
1-30
8.055
$ (88,605)
Reduction in filtering systems costs per year
$ 3,000
1-30
8.055
$ (24,165)
$ (1,705,835)
Copyright © 2015 Pearson Education, Inc.
15-29
1. The environmental impact of the living roof is much less than the composite roof.
3. The potential customer goodwill that will be created by instituting green practices such as the living roof.
Copyright © 2015 Pearson Education, Inc.
15-30
P15-39B
Req. 1
First, select the highest volume (occupancy %) and the lowest volume (occupancy %).
Next, calculate the number of room days:
Cost
Activity
Variable cost:
High pt.
$32,400
59,860
February
Low pt.
$17,946
27,740
September
Difference
$14,454
32,120
Change in cost / change in volume = Variable cost of laundry per guest day
$14,454 / 32,120 = $0.45
Req. 2
First, select the highest volume (occupancy %) and the lowest volume (occupancy %).
Next, calculate the number of room days:
Cost
Activity
Variable cost:
High pt.
$86,500
59,860
February
Low pt.
$43,138
27,740
September
Difference
$43,362
32,120
Change in cost / change in volume = Variable cost of housekeeping per guest day
$43,362 / 32,120 = $1.35
Req. 3
When using the high-low method, the variable cost of laundry per guest day is estimated to be $0.45. If guests are
given a $0.80 credit per day that linens are reused, the resort will not save anything per guest day. It does not appear
Copyright © 2015 Pearson Education, Inc.
15-31
Req. 5
Regression: LAUNDRY
SUMMARY OUTPUT
Req. 6
Regression: HOUSEKEEPING
SUMMARY OUTPUT
Managerial Accounting 4e Solutions Manual
(continued) P15-39B
P15-40B
Req. 1
Composite roof:
Year(s)
PV factor
PV
Cost
$ 1,300,000
Now
1
$ 1,300,000
Annual maintenance costs per year
$ 15,000
1-25
12.783
$ 191,745
Salvage value
$ 35,000
25
0.233
$ (8,155)
$ 1,483,590
Req. 2
Living roof:
Vegetation cost
$ 310,000
Now
1
$ 310,000
Waterproof membrane
$ 105,000
Now
1
$ 105,000
Growing medium
$ 220,000
Now
1
$ 220,000
Expert fee
$ 5,000
Now
1
$ 5,000
Construction costs
$ 720,000
Now
1
$ 720,000
Other miscellaneous fees
$ 190,000
Now
1
$ 190,000
Annual maintenance costs per year
$ 35,000
1-25
12.783
$ 447,405
Reduction in heating/cooling costs per year
$ 35,000
1-25
12.783
$ (447,405)
Reduction in storm water treatment costs
per year
$ 4,000
1-25
12.783
$ (51,132)
Reduction in filtering systems costs per year
$ 1,000
1-25
12.783
$ (12,783)
$ 1,486,085
1. The environmental impact of the living roof is much less than the composite roof.
3. The potential customer goodwill that will be created by instituting green practices such as the living roof.
Copyright © 2015 Pearson Education, Inc.
15-33
A15-41
1. Pressure to become more sustainable can usually be categorized into four main reasons: cost reduction,
regulatory compliance, stakeholder influence, and competitive strategy. Think of an organization with which
2. Adding a fifth perspective of “community” to the traditional four balanced scorecard perspectives (financial,
customer, internal business, and learning and growth) is sometimes advocated as a way to measure a company’s
3. Information from an environmental management accounting (EMA) system can be used to support managers
and their primary responsibilities of planning, directing, and controlling. Think of an organization with which
use them.
4. Find a recent annual report for a publicly held company in which you are interested. Summarize what
sustainability information is provided in that annual report. Based on the sustainability information provided in
5. There are three components in the triple bottom line: people, planet, and profit. Which component do you
6. The effect of sustainability on the planet (environment) is probably the most visible component of the triple
bottom line. For a company with which you are familiar, list two examples of its sustainability efforts related to
7. One controversial area regarding sustainability is whether organizations should use their sustainability progress
Copyright © 2015 Pearson Education, Inc.
15-35
A15-42
2. What environmental goals does this company have for the upcoming five to ten years?
Chevron intends to keep providing a zero incident goal in all of its deep-water production.
3. Judging from the information in the report(s) from the company, does the company appear to emphasize
people, planet, or profit? Or does the company appear to give equal emphasis to each component of the triple
4. What types of EMA information might be reported internally by this company? Make reasonable “guesses;” the
5. Perform a web search to find other sources of information about this company’s sustainability efforts other than
6. Perform a web search for sustainability issues in the industry in which this organization operates. Does the
7. What is your overall sense of the company’s commitment to sustainability from everything you have seen? Be
specific and give details to justify your response.
Copyright © 2015 Pearson Education, Inc.
15-36
(30-40 min.) A15-43
Student answers will vary.
(10–15 min.) A15-44
1.
2. Vanessa should present the issue to the next level supervisor since her direct supervisor has demanded that she
1. Some GRI G4 reporting guideline aspects that appear to be missing from FirstEnergy’s report include energy
2. FirstEnergy may not use GRI reporting standards for its sustainability reporting because it is not mandatory.
3. If a company does not use standard framework to prepare its sustainability report, material environmental,
5. FirstEnergy could issue a sustainability report because sustainability reports can be used as an internal change
