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PM Chapter 4 Questions Environmental Management Accounting
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hello is the use of environmental accounting for internal users?? i thought it is for also externals.
It is only the company internally that can measure the costs involved.
Sir, but we can also publish external report using Internal Information on improving our Environmental issues for the boost of sales & marketing which might lead to attractive customer awareness & charging a premium price, right? This question no 3 kinda contradicts the concept I guess! ??
The company might produce extracts from it, but they are very unlikely to publish the entire report which is prepared for management.
Thanks for this one but I wonder why the correct answer is Flow Cost Accounting.
I wonder that too…
its because one of the categories in flow cost accounting is “delivery and DISPOSAL”, therefore it does take into account the dismantling of machines at the end of the project since thats considered a disposal.
Thank you!
me too
Sir, in the online mock exams on open tuition,
the answer for the cost of dismantling machines at the end of a project Is given as lifecycle costing.
So incase it comes in the exam, which is the answer that I should be choosing, flow cost accounting or lifecycle costing?
Sir could you please explain why Q3 is flow cost and not life cycle. I’m not able to find any answers in the comments
To be honest this is a poor question as it stands (and BPP no longer include it in their revision kit), and I will have it changed.
However, although life-cycle costing will attempt to include the costs of dismantling, it is flow-cost accounting that will specifically consider it.
okay thank you 馃檪
You are welcome 馃檪
Sir in BPP Revision kit the same MCQ answered is Lifecycle costing and not Flow cost accounting. Reference (Q1:1.8).
See Shirley’s answer below 馃檪
Got it 馃檪
Great 馃檪
Hi Moffat,
I can only see the answer below and there is no explanation of why the flow cost accounting technique is the relevant method. yet, the life cycle costing is also taking cost of disposal of waste into account when calculating the environmental cost.
Moffat can you please provide some explanation about the difference between the lifecycle costing and flow cost accounting ?
i would have to agree that the answer for number 3 should be life cycle costing
No – the answer is flow cost accounting.
See Shirley’s explanation below.
May u plz explain why it is “Flow cost” and not “Life Cycle” tks
I don’t know which of the questions you are asking about.
This is just my understanding. When I look back to the textbook, it described the main purpose of flow cost is to reduce the negative production portion and increase positive product portion. While the life-cycle took all the cost as a whole to consider when often in the preliminary project stage. So given the question to compute dismantle machine only at the end of project, the organization is more likely to apply the flow cost methods. Hope this helps!
Please explain the answer for question (3).
My answer is Lif cycle costing.So, i don’t quite understand why the correct answer is flow cost accounting.
In my opinion, answer to the question “which accounting technique is relevant when considering cist of dismantling the machines at the end of project” is life cycle costing whereas given answer is flow cost accounting. Kindly explain.