Required:

Explain how a strategic-based responsibility accounting system can be used to help improve Prose's performance.

Melbourne Industrial Ltd (MIL) produces two types of gadgets: Celerium and Millerium. MIL recently received significant criticism from environmental groups, local residents, and the federal government concerning its environmental performance. Gett W. Orried, president of MIL, wants to know how the company's environmental activities affect the cost of each product. Gett believes that the main source of the environmental problems lies with Celeriun, but would like some evidence to support or refute her belief. The controller has assembled the following data to help determine this: Celerium Millerium Number of units produced 500,000 1,000,000 Engineering hours (process design) 750 2,500 Kilograms of solid residues treated 15,000 5,000 Inspection hours (environmental) 6,000 3,000 Cleanup hours (local lake) 4,000 1,000 Additionally, the following environmental activity costs were reported: Designing process $ 81,250 Treating residues 300,000 Inspecting processes 72,000 Cleaning up lake 100,000 Gett W. Orried has also decided on the following strategy to improve MIL's environmental performance: Hire an environmental engineer to provide the capabilities needed to improve the environmental performance. This engineer would be responsible to redesign and improve the production processes with the objective of reducing the solid residues. Gett expects this action to reduce the treating residues costs. All employees would be sent to several training seminars to learn about environmental management. These employees would then be empowered to make improvements in MIL's environmental performance. Once the processes were redesigned, the company would participate in a third-party environmental certification program so that customers would be assured that the environmental improvements were valid. Melbourne Industrial Ltd (MIL) produces two types of gadgets: Celerium and Millerium. MIL recently received significant criticism from environmental groups, local residents, and the federal government concerning its environmental performance. Gett W. Orried, president of MIL, wants to know how the company's environmental activities affect the cost of each product. Gett believes that the main source of the environmental problems lies with Celeriun, but would like some evidence to support or refute her belief. The controller has assembled the following data to help determine this: Celerium Millerium Number of units produced 500,000 1,000,000 Engineering hours (process design) 750 2,500 Kilograms of solid residues treated 15,000 5,000 Inspection hours (environmental) 6,000 3,000 Cleanup hours (local lake) 4,000 1,000 Additionally, the following environmental activity costs were reported: Designing process $ 81,250 Treating residues 300,000 Inspecting processes 72,000 Cleaning up lake 100,000 Gett W. Orried has also decided on the following strategy to improve MIL's environmental performance: Hire an environmental engineer to provide the capabilities needed to improve the environmental performance. This engineer would be responsible to redesign and improve the production processes with the objective of reducing the solid residues. Gett expects this action to reduce the treating residues costs. All employees would be sent to several training seminars to learn about environmental management. These employees would then be empowered to make improvements in MIL's environmental performance. Once the processes were redesigned, the company would participate in a third-party environmental certification program so that customers would be assured that the environmental improvements were valid