Environmental Costs Environmental costs can be a significant percentage of total operating costs; according to the environment are referred to as it is possible to improve environmental performance Environmental costs can be while simultaneously reducing environmental costs. Environmental costs are costs that are incurred because classified into four categories: prevention, detection, internal failure, and external failure. The costs to prevent the production of contaminants or waste that damage Costs of activities performed because contaminants and waste have been produced but not discharged into Costs of activities executed to determine if products, processes, and other activities within the firm are in Costs of activities performed after discharging contaminants and waste can be divided into categories. Select "Yes or No" for the following the environment are referred to as compliance with appropriate environmental standards are referred to as Finally, into the environment are referred to as categories. Realized external failure costs Realized internal failure costs Unrealized internal failure (societal) costs Unrealized external failure (societal) costs Environmental cost reporting is essential for improving environmental performance and controlling environmental costs. An environmental cost report shows the relative amounts expended on each environmental cost category and reveals the impact of environmental costs on firm profitability.