Question
Simplifying the ABC System: TDABC Golding Bank provided the following data about its two checking account products and their associated resources and activities: Resources
Simplifying the ABC System: TDABC Golding Bank provided the following data about its two checking account products and their associated resources and activities: Resources Activities Time per Unit Activity Driver Traditional Interest-Bearing Account Account Supervision $64,000 Processing accounts 0.20 hr. No. of accounts 2,700 1,300 Phone and supplies 72,000 Issuing statements 0.10 hr. No. of statements 60,000 10,000 Salaries 238,000 Processing transactions 0.05 hr. No. of transactions 160,000 120,000 Computer 26,000 Answering customer inquiries 0.15 hr. No. of inquiries 1,500 1,500 Total 400,000 At practical capacity, Golding uses 20,000 check processing hours. Required: 1. Calculate the capacity cost rate for the checking account process. Round your answer to the nearest cent. 20 per hour Calculate the activity rates for the four activities. Round your answers to the nearest cent. Processing accounts Issuing statements 4 per account 2 per statement Processing transactions Answering inquiries 1 per transaction 3 per inquiry 2. Assuming there are 2,700 interest-bearing checking accounts, calculate the cost per account using the activity rates from Requirement 1. Round your answers to the nearest cent. Unit cost $ X 3. A time equation is used to assign resource costs to checking accounts. Select a time equation for the interest-bearing checking account product. 0.20(number of accounts) + 0.10(number of statements) + 0.05(number of transactions) + 0.15(number of inquiries) Again, assuming that there are 2,000 interest bearing accounts, show that the resource cost per account is the same as calculated in Requirement 2. Round your answers to the nearest cent. Unit Cost = ($ 20 ) x (
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