1. Environmental Cost Report

   Verde Company reported operating costs of $32,000,000 as of December 31, 20x5, with the following environmental costs:

   Testing for contamination	$ 480,000
   Inspecting products	544,000
   Treating toxic waste	992,000
   Obtaining ISO 14001 certification	480,000
   Designing processes	416,000
   Cleaning up oil spills	2,016,000
   Maintaining pollution equipment	864,000
   Cleaning up contaminated soil	3,872,000

   Required:

   1. Prepare an environmental cost report, classifying costs by quality category and expressing each as a percentage of total operating costs. Round percentages to two decimal places, if rounding is required. For example, 5.79% would be entered as "5.79".

   Verde Company
   Environmental Cost Report
   For the Year Ended December 31, 20x5
   	Environmental Cost	Total Environmental Cost	Percentage of Operating Costs
   Prevention costs:
   	$
   		$	%
   Detection costs:
   	$
   			%
   Internal failure costs:
   	$
   			%
   External failure costs:
   	$
   			%
   Total quality costs		$	%

   2. What if Verde deliberately did not include the cost of damaging the ecosystem because of solid waste disposal in its environmental cost report? What is the most likely reason?