Exercise 7-8 (Algo) Computing and Interpreting Activity Rates [LO7-3]The operations vice president of Security Home Bank has been interested in investigating the efficiency of the bank's operations. Shehas been particularly concerned about the costs of handling routine transactions at the bank and would like to compare these costs atthe bank's various branches. If the branches with the most efficient opemtions can be identified, their methods can be studied andthen replicated elsewhere. While the bank maintains meticulous records of wages and other costs, there has been no attempt thus farto show how those costs are related to the various services provided by the bank. The operations vice president has asked your helpin conducting an activity-based costing study of bank operations. In particular, she would like to know the cost of opening an account,the cost of processing deposits and withdrawals, and the cost of processing other customer transactions.The Westfield branch of Security Home Bank has submitted the following cost data for last year:Teller wagesAssistant branch manager salaryBranch manager salary$ 145,00074,00094,000Total$ 313,000Virtually all other costs of the branch–rent, depreciation, utilities, and so on–are organization-sustaining costs that cannot bemeaningfully assigned to individual customer transactions such as depositing checks.In addition to the cost data above, the employees of the Westfield branch have been interviewed concerning how their time wasdistributed last year across the activities included in the activity-based costing study. The results of those interviews appear below:Distribution of Resource Consumption Across ActivitiesProcessingDeposits andWithdrawalsProcessingOpeningOther CustomerOtherAccountSTransactionsActivitiesTotalsTeller wagesAssistant branch manager salaryBranch manager salary5%72%16%7%100%8%14%26%528100%5%0%15%808100%The manager of the Westfield branch of Security Home Bank has provided the following data concerning the transactions of the< Prev6 of 8Next > meaningfully assigned to individual customer transactions such as depositing checks.In addition to the cost data above, the employees of the Westfield branch have been interviewed concerning how their time wasdistributed last year across the activities included in the activity-based costing study. The results of those interviews appear below:Distribution of Resource Consumption Across ActivitiesProcessingDeposits and Other CustomerWithdrawalsProcessingOpeningOtherAccountsTeller wagesTransactionsActivitiesTotalsAssistant branch manager salary72%16%7%100%Branch manager salary8%14%26%52%100%5%0%15%80%100%The manager of the Westfield branch of Security Home Bank has provided the following data concerning the transactions of thebranch during the past year:ActivityOpening accountsProcessing deposits and withdrawalsProcessing other customer transactionsTotal Activity at the Westfield Branch185 new accounts opened50,500 deposits and withdrawals processed1,500 other customer transactions processedRequired:1. Compute the activity rates for the activity-based costing system. (Round your answers to 2 decimal places.)Activity Cost PoolActivity RateOpening accountsper account openedProcessing deposits and withdrawalsper deposit or withdrawalProcessing other customer transactionsper other customer transactionPrev6 of 8Next >585

The activity unit cost is calculated as total estimated activity cost divided by base activity…

Exercise 7-8 (Algo) Computing and Interpreting Activity Rates (LO7-3] The operations vice president of Security Home Bank has been interested in investigating the efficiency of the bank's operations. She has been particularly concerned about the costs of handling routine transactions at the bank and would like to compare these costs at the bank's various branches. If the branches with the most efficient opemtions can be identified, their methods can be studied and then replicated elsewhere. While the bank maintains meticulous records of wages and other costs, there has been no attempt thus far to show how those costs are related to the various services provided by the bank. The operations vice president has asked your help in conducting an activity-based costing study of bank operations. In particular, she would like to know the cost of opening an account, the cost of processing deposits and withdrawals, and the cost of processing other customer transactions. The Westfield branch of Security Home Bank has submitted the following cost data for last year: Teller wages Assistant branch manager salary Branch manager salary $ 145,000 74,000 94,000 $ 313,000 Total Virtually all other costs of the branch-rent, depreciation, utilities, and so on–are organization-sustaining costs that cannot be meaningfully assigned to individual customer transactions such as depositing checks. In addition to the cost data above, the employees of the Westfield branch have been interviewed concerning how their time was distributed last year across the activities included in the activity-based costing study. The results of those interviews appear below: Distribution of Resource Consumption Across Activities Processing Deposits and Other Customer Withdrawals Processing Opening Other Accounts Transactions Activities Totals Teller wages Assistant branch manager salary Branch manager salary 58 728 168 78 1008 88 148 268 528 1008 58 08 15% 808 1008 The manager of the Westfield branch of Security Home Bank has provided the following data concerning the transactions of the