Rock Solid Bank and Trust $($RSB&T$)$ offers only checking accounts. Customers can write checks and use a network of automated teller

machines. RSB&T earns revenue by investing the money deposited; currently, it averages $6\mathrm{.}30$ percent annually on its investments of

those deposits. To compete with larger banks, RSB&T pays depositors $0\mathrm{.}50$ percent on all deposits. A recent study classified the

bank's annual operating costs into four activities.

Data on two representative customers follow.

Required:

a$.$ Compute RSB&T$\text{'}$s operating profits.

b$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are based only on deposits. Interest costs $=$

$0\mathrm{.}50$ percent of deposits; operating costs are $4$ percent $(=$$$31,500,\frac{000}{\text{\$}}787,500,000)$ of deposits.

c$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are computed using the information in the

activity$-$based costing analysis.