ACCA Applied Skills · Performance Management · Accounting for environmental and sustainability factors
Which of the following best describes a 'hidden' (less tangible) environmental cost?
Loss of customer goodwill following publicity about pollution is a hidden environmental cost, because it is hard to measure and not captured in conventional accounting records. Disposal fees, fuel duty and compliance wages are conventional costs recorded in the ledgers.
- AFuel duty included in the purchase price of delivery fuel
- BLoss of customer goodwill following publicity about pollutionCorrect
- CWaste disposal fees invoiced by a contractor
- DWages of the environmental compliance manager
Explanation
Hidden or less tangible costs are difficult to identify and quantify, such as loss of goodwill and brand damage. The other items are conventional costs that are directly recorded in the accounting system.
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