Activity Rate $0.20 Driver Classic Gold Activity Procesing transactions Preparing statements Answering questions Transactions processed Number of statements Number of calls ATM transactions 12.000 7,200 12,000 7,200 0.95 24,000 36,000 4.00 Providing ATMS 48,000 14,400 1.50
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Calculating ABC Unit Costs
Perkins National Bank has collected the following information for four activities and two types of credit
There are 7,500 holders of Classic cards and 30,000 holders of Gold
cards.
Required:
Calculate the unit cost (rounded to the nearest cent) for Classic and Gold
credit cards.
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