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Premium Company provides the following ABC costing information: Activities Total Costs Activity-cost drivers Account inquiry $200,000 6,500 hours Account billing $140,000 650,000 lines Account verification
Premium Company provides the following ABC costing information: Activities Total Costs Activity-cost drivers Account inquiry $200,000 6,500 hours Account billing $140,000 650,000 lines Account verification accounts $75,000 16,000 accounts Correspondence letters $ 25,000 2,800 letters Total costs $440,000 The above activities are used by Departments A and B as follows: Department A Department B Account inquiry hours 2,500 hours 4,000 hours Account billing lines 400,000 lines 250,000 lines Account verification accounts 10,000 accounts 6,000 accounts Correspondence letters 1,200 letters 1,600 letters How much of account verification costs will be assigned to Department A? Consider a 7-year balloon loan for A house costs $100,000. The bank requires a monthly payment equal to that of a 30-year fixed-rate loan with a nominal annual rate of 14%. How much will the borrower owe when the balloon payment is due if the loan to value ratio is 85%? And what is the total interest payment in this case
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