Simplifying the ABC System: TDABCGolding Bank provided the following data about its resources and activities for its checking account process:Time per UnitTraditional Interest-BearingResourcesActivitiesDriverof ActivityAccountAccountSupervisionS70,000 Processing accountsNo. of accounts0.20 hr.2,0001,000Phone and supplies90,000 Issuing statementsNo. of statements0.10 hr.60,00010,000Salaries275.000 Processing transactionsNo. of transactions0.05 hr.160.000120,000Computer25,000 Answering customer inquiriesNo. of inquiries0.15 hr.1,5001,500Tatal$460,000At practical capacity, Golding uses 25,000 check processing hours.Required:1. Calculate the capacity cost rate answers to the nearest cent.for the checking account process. Round your18.4 V per hourCalculate the activity rates for the four activities. Round your answers to the nearest cent.Processing accounts3.68 V per accountIssuing statements1.84 V per statementProcessing transactions0.92 V per transactionAnswering inquiries2.76 V per inquiry2. Assuming there are 2,000 interest-bearing checking accounts, calculate the cost per account using the activity retes from Requirement 1. Round your answers to the nearest cent.Unit cost s3.68 X3. A time equation is used to assign resource costs to checking accounts. Select a time equation for the interest-bearing checking account product.0.20(number of accounts) + 0.10(number of statements) + 0.05(number of transactions) + 0.15(number of inquiries)Again, assuming that there are 2,000 interest bearing accounts, show that the resource cost per account is the same as caloulated in Requirement 2. Round your answers to the nearest cent.3.68 x4. What if process improvements decreased the number of customer inquiries, leading to a 10 percent reduction in check processing haurs and a $10,000 reduction in total resource costs? Calculate the capacity cast rate for the checking account process.20 V per hourUpdate all the activity rates for these changes in operating conditions.Processing accounts4 V per accountIssuing statements2 per statementProcessing transactions1v per transactionAnswering inquiries3 V per inquiry

Unit Cost- The unit cost of a thing is the cost per unit thing. It is calculated by dividing the…

Simplifying the ABC System: TDABC Solding Bank provided the following data about its resources and activities for its checking account process: Time per Unit Traditional Interest-Bearing Resources Activities Driver of Activity Account Account Supervision S70,000 Processing accounts No. of accounts 0.20 hr. 2,000 1,000 Phone and supplies 90,000 Issuing statements No. of statements 0.10 hr. 60,000 10,000 Salaries 275,000 Processing transactions No. of transactions 0.05 hr. 160,000 120,000 Computer 25,000 Answering customer inquiries No. of inquiries 0.15 hr. 1,500 1,500 Total S460,000 at practical capacity, Golding uses 25,000 check processing hours. Required: 1. Calculate the capacity cost rate for the checking account process. Round your answers to the nearest cent. 18.4 per hour Calculate the activity rates for the four activities. Round your answers to the nearest cent. Processing accounts 3.68 V per account

Simplifying the ABC System: TDABC Solding Bank provided the following data about its resources and activities for its checking account process: Time per Unit Traditional Interest-Bearing Resources Activities Driver of Activity Account Account Supervision S70,000 Processing accounts No. of accounts 0.20 hr. 2,000 1,000 Phone and supplies 90,000 Issuing statements No. of statements 0.10 hr. 60,000 10,000 Salaries 275,000 Processing transactions No. of transactions 0.05 hr. 160,000 120,000 Computer 25,000 Answering customer inquiries No. of inquiries 0.15 hr. 1,500 1,500 Total S460,000 at practical capacity, Golding uses 25,000 check processing hours. Required: 1. Calculate the capacity cost rate for the checking account process. Round your answers to the nearest cent. 18.4 per hour Calculate the activity rates for the four activities. Round your answers to the nearest cent. Processing accounts 3.68 V per account

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Simplifying the ABC System: TDABC Golding Bank provided the following data about its resources and activities for its checking account process: Time per Unit Traditional Interest-Bearing Resources Activities Driver of Activity Account Account Supervision $70,000 Processing accounts No. of accounts 0.20 hr. 2,000 1,000 Phone and supplies 90,000 Issuing statements No. of statements 0.10 hr. 60,000 10,000 Salaries 275,000 Processing transactions No. of transactions 0.05 hr 160,000 120,000 Computer 25,000 Answering customer inquiries No. of inquiries 0.15 hr. 1,500 1,500 Total $460,000 At practical capacity, Golding uses 25,000 check processing hours. Required: 1. Calculate the capacity cost rate for the checking account process. Round your answers to the nearest cent. 18.4 V per hour Calculate the activity rates for the four activities. Round your answers to the nearest cent. Processing accounts 3.68 V per account Issuing statements 1.84 V per statement Processing transactions 0.92 V per…
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