Reference no: EM133062956

Question - Coburg Casual Coffee has evaluated the social and environmental costs of its coffee roasting facility. The total cost of running the roasting facility is $987,654, including $689,001 for the cost of unroasted beans and environmental costs of $91,173, as shown below.

Cost Item Cost Description Amount

i. Depreciation of oven fume extractor system $4,325

ii. Employee training costs to reduce environmental accidents 5,600

iii. Monitoring system to detect fumes 4,891

iv. Fine from Victorian EPA for dumping coffee grounds into the sewer 5,691

v. Inspection of drainage systems to detect problems with discharge 1,241

vi. Reduction in the value of nearby houses due to odour 53,651

vii. Routine cleaning of extractor system to remove coffee residues 2,561

viii. Disposal of waste coffee grounds 5,652

ix. Medical costs relating to employees' inhalation of fumes 7,561

Total 91173

(a) Prepare an environmental cost analysis of the existing cost of $91,173, highlighting prevention, appraisal, and internal and external failure costs.

(b) Identify the social costs that relate to the operation. Is there a link between social costs and environmental costs?

(c) Use this cost report to recommend what the company might do to improve its environmental performance.