Which of the following represents the environmental management accounting response to product costing, as compared with the traditional view on recording environmental costs?

A) Environmental costs are spread across all processes and production.
B) Environmental costs are not explicitly recorded in the accounts.
C) Environmental costs are included in the broader sustainability perspectives.
D) Environmental costs are upstream or downstream costs and therefore not included in product costs.

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Nolan mandel · Accepted Answer

Final Answer : C, Explanation :  The environmental management accounting response to product costing includes including environmental costs in the broader sustainability perspectives, rather than just the traditional view of recording them as separate costs. This approach considers the long-term impacts of environmental costs and their integration within the overall business strategy. Option A is incorrect because it implies that environmental costs are allocated equally across processes which may not be appropriate. Option B is incorrect since there is a need to explicitly record environmental costs. Option D is incorrect because the environmental costs, whether upstream or downstream need to be accounted for in product costs.

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