Question
Banc Corp. Trust is considering either a bank-wide overhead rate or department overhead rates to allocate $412,000 of indirect costs. The bank-wide rate could be
Banc Corp. Trust is considering either a bank-wide overhead rate or department overhead rates to allocate $412,000 of indirect costs. The bank-wide rate could be based on either direct labor hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor hours for Consumer Loans and a dual rate based on direct labor hours and the number of loans processed for Commercial Loans. The following information was gathered for the upcoming period:
Department | DLH | Loans Processed | Direct Costs |
Consumer | 14,000 | 700 | $280,000 |
Commercial | 8,000 | 300 | $180,000 |
(Round your answer to the nearest $1.00)
QUESTION: If a dual rate is used to assign indirect costs to the commercial department, assume Banc Corp estimates that it costs $500 to analyze and close a commercial loan. This amount has been included in the $412,000 of indirect costs. One alternative would be for the remaining indirect costs to be allocated between the departments using a bank-wide rate based on the number of direct labor hours used. This would result in how much of the $412,000 being assigned to the commercial department in total?
(Round your answer to the nearest $1.00)
QUESTION: If Banc Corp. Trust uses a bank-wide rate based on the number of loans processed, what would be the total costs for the Consumer Department?
QUESTION: If Banc Corp. Trust uses a bank-wide rate based on the number of loans processed, what would be the total costs for the Commercial Department?
QUESTION: If a dual rate is used to assign indirect costs to the commercial department, assume Banc Corp estimates that it costs $500 to analyze and close a commercial loan. This amount has been included in the $412,000 of indirect costs. One alternative would be for the remaining indirect costs to be allocated between the departments using a bank-wide rate based on the number of loans processed. This would result in how much of the $412,000 being assigned to the commercial department in total?(round to $1.00)
(Round your answer to the nearest $1.00)
QUESTION: If Banc Corp. Trust uses a bank-wide rate based on direct labor hours, what would be the indirect costs allocated to the Commercial Department?
(Round your answer to the nearest $1.00)
QUESTION: If Banc Corp. Trust uses a bank-wide rate based on direct labor hours, what would be the indirect costs allocated to the Consumer Department?
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