Goldman Sachs Group Inc. is analyzing its trading operation costs using Standard Cost Accounting:

Requirements:

• Calculate the Standard Cost per trade transaction:
  • Direct Costs: $100 per transaction
  • Indirect Costs: $50 per transaction

• Apply Marginal Cost Accounting to assess the cost impact of executing additional trades.
• Evaluate the benefits of Activity-Based Costing in allocating regulatory compliance costs.
• Discuss how each costing method influences trading strategy and profitability at Goldman Sachs.

Standard Cost Calculation:

Category	Amount per Transaction ($)
Direct Costs	$100
Indirect Costs	$50
Total Standard Cost per Transaction	$150