Hannibal Company Produces a Number of Chemical Products, Two of Which

Multiple Choice

Hannibal Company produces a number of chemical products, two of which are Product X1 and Product X2. The controller and environmental manager have identified the following environmental activities and costs associated with the two products: $\begin{array} { l r r } & \text { Product } \mathrm { X } 1 & \text { Product X2 } \\ \text { Pounds produced } & 400,000 & 1,000,000 \\ \text { Packaging materials (pounds) } & 120,000 & 60,000 \\ \text { Energy usage (kilowatt hours) } & 40,000 & 20,000 \\ \text { Toxic rel eases (pounds into air) } & 100,000 & 20,000 \\ \text { Pollution control (machine hours) } & 16,000 & 4,000\\\\\text { Costs of activities: } & \\\text { Using packaging materials } &\$ 360,000 \\\text { Using energy } &96,000 \\\text { Rel easing toxins (fines) } &48,000 \\\text { Operating pollution control equipment } & 112,000 \end{array}$
What is the fines cost per unit for toxic releases of Product X1?

A) $0.040
B) $0.008
C) $0.100
D) $0.080