Golding Bank provided the following data about its resources and activities for its check- CORNERSTONE 4-7 ing account process:

Required:
1. Calculate the capacity cost rate for the checking account process.
2. Calculate the activity rates for the four activities. If the total number of statements issued was 20,000, calculate the cost of the issuing statements activity.
3. What if process improvements decreased the number of customer inquiries, leading to a 10 percent reduction in check processing hours and a $10,000 reduction in total resource costs? Update all the activity rates for these changes in operating conditions.LO1

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Resources Supervision Phone and supplies Salaries Computer Total Total check processing hours Activities Time per Unit Activity Driver $ 70,000 Processing accounts 0.20 hr. No. of accounts 90,000 Issuing statements 0.10 hr. No. of statements 275,000 Processing transactions 0.05 hr. No. of transactions 25,000 Answering customer inquiries 0.15 hr. No. of inquiries $460,000 25,000 (practical capacity)