Refer to the information in Problem 17-40.

Required
Write a memo to the managers at Bay Area Bank recommending which variances they should investigate this period, along with your reasons.

Data From Problem 17-40:

Bay Area Bank estimates that its overhead costs for policy administration should be $30 for each new account obtained and $0.45 per year for each $1,000 of deposits. The company set a budget of selling 20,000 new accounts during the coming period. In addition, it estimated that the total deposits for the period would average $43,200,000.

During the period, actual costs related to new accounts amounted to $572,250. The bank sold a total of 19,200 new accounts.

The cost of maintaining existing accounts was $18,000. Had these costs been incurred at the same prices as were in effect when the budget was prepared, the costs would have been $17,700, however, some costs changed. Also, deposits averaged $45,000,000 during the period.