The Cumberland branch of Barron State Savings Bank (BSSB) is a retail branch in a rapidly growing residential area. It services individuals and local businesses. To support its services, the branch employs 14 tellers, 3 retail sales managers (RSMs), and the branch managing officer. The branch services about 2,800 customers. Each of the 70 branches of BSSB is implementing ABC in order to improve profitability. BSSB's branch managing officers have been given the responsibility to implement activity-based costing. The managing officer at the Cumberland branch decided to implement a two-stage ABC system. The following process map depicts its two-stage ABC system. (Click the icon to view the process map.) The results of the ABC study are summarized in the "Internal Activity Analysis": (Click the icon to view the internal activity analysis.) E: (Click the icon to view the cost data for the last year.) A part of the activity analysis conducted at the Cumberland branch of Barron State Savings Bank (BSSB) was identifying potential cost drivers for each major activity. The following cost drivers were chosen because they were both plausible and reliable and data were available: (Click the icon to view the cost driver data.) (Click the icon to view the calculation of traceable costs.) (Click the icon to view the benchmarking data.) Read the requirements. Requirement 1. Determine the allocated (indirect) cost per account for retail and commercial accounts. Use the process map as a guide. Begin by calculating the cost per unit for each of the three main activities. First enter the formula, then calculate the cost per unit. (Round your answers to four decimal places.) Cost per Driver Unit X Data Table All employees have been interviewed as part of the ABC study. For example, tellers were asked how they spent their Three major activit were identifie They that they spent most of their time 0%) processing deposits and withdrawals. They also estimated that they spent about 20% of their time processing new accounts and about 20% of their time processing other transactions. The remaining 10% of their time was spent on all other banking activities. The results of the interviews are presented in the following table: Internal Activity Analysis Process All Other Open New Deposits and Process Other Banking Accounts Withdrawals Transactions Activities Total Teller wages 20% 50% 20% 10% 100% Retail sales 5% 15% 25% 55% 100% manager salary Managing officer 0% 15% 25% 60% 100% salary chock Anchor Question Help - X 0 Data Table Ana Data Table Data Table X serv H. TI hagi nt a Teller wages Ba th Resource Allocated cost Of the 2,800 customers of the branch, only 300 are local businesses. The business-customer class generated 20 new accounts, 89,000 deposits and withdrawals, and 24,000 other transactions. The implementation of ABC at all branches of BSSB provided sufficient data for internal benchmarking. The following are the lowest activity costs among all branches implementing two-stage ABC systems: Activity Open new accounts Tellers $ The Cumberland branch has the following cost data for the last year. $ 390,000 RSM salaries and benefits 220,000 Managing officer salary and benefits 140.000 Other bank costs 450,000 $ Total 1,200,000 The "other bank costs" include depreciation on the facility including furniture, building, equipment, insurance, rentals of computers, contracted computer services, telecommunications, and utilities. These costs cannot be directly or indirectly related to routine bank activities, such as processing new accounts or processing deposits or withdrawals, and, thus, are unallocated. There are no costs that can be traced directly to customers so the Cumberland branch has just two types of costsindirect and unallocated 78,000 11.000 Retail sales managers $ 89,000 Total traceable cost Activity Open new account Process deposits and withdrawals Resource Allocated cost ss th Activity Process deposits and withdrawals $ Lowest Activity Cost per Driver Unit $172.65 per new account $2.09 per deposit or withdrawal $3.58 per transaction Lowest Customer Cost per Account $129.18 $782.10 per Tellers Retail sales managers Process other transactions 195,000 33.000 21,000 Uni Customer Class Managing officers Print Done Retail $ 249,000 Commercial Total traceable cost Activity Process other Resource Allocated cost Tellers $ 78,000 Print Done transactions Retail sales managers - X 55,000 35,000 Data Table Managing officers $ Total traceable cost 168,000 Annual Flow of Cost Driver Print Done 580 Activity Cost Driver Process new accounts Number of new accounts Process deposits and withdrawals Number of deposits and withdrawals Process other transactions Number of other transactions 167,000 49,000 Print Done The Cumberland branch of Barron State Savings Bank (BSSB) is a retail branch in a rapidly growing residential area. It services individuals and local businesses. To support its services, the branch employs 14 tellers, 3 retail sales managers (RSMs), and the branch managing officer. The branch services about 2,800 customers. Each of the 70 branches of BSSB is implementing ABC in order to improve profitability. BSSB's branch managing officers have been given the responsibility to implement activity-based costing. The managing officer at the Cumberland branch decided to implement a two-stage ABC system. The following process map depicts its two-stage ABC system. (Click the icon to view the process map.) The results of the ABC study are summarized in the "Internal Activity Analysis": (Click the icon to view the internal activity analysis.) E: (Click the icon to view the cost data for the last year.) A part of the activity analysis conducted at the Cumberland branch of Barron State Savings Bank (BSSB) was identifying potential cost drivers for each major activity. The following cost drivers were chosen because they were both plausible and reliable and data were available: (Click the icon to view the cost driver data.) (Click the icon to view the calculation of traceable costs.) (Click the icon to view the benchmarking data.) Read the requirements. Requirement 1. Determine the allocated (indirect) cost per account for retail and commercial accounts. Use the process map as a guide. Begin by calculating the cost per unit for each of the three main activities. First enter the formula, then calculate the cost per unit. (Round your answers to four decimal places.) Cost per Driver Unit X Data Table All employees have been interviewed as part of the ABC study. For example, tellers were asked how they spent their Three major activit were identifie They that they spent most of their time 0%) processing deposits and withdrawals. They also estimated that they spent about 20% of their time processing new accounts and about 20% of their time processing other transactions. The remaining 10% of their time was spent on all other banking activities. The results of the interviews are presented in the following table: Internal Activity Analysis Process All Other Open New Deposits and Process Other Banking Accounts Withdrawals Transactions Activities Total Teller wages 20% 50% 20% 10% 100% Retail sales 5% 15% 25% 55% 100% manager salary Managing officer 0% 15% 25% 60% 100% salary chock Anchor Question Help - X 0 Data Table Ana Data Table Data Table X serv H. TI hagi nt a Teller wages Ba th Resource Allocated cost Of the 2,800 customers of the branch, only 300 are local businesses. The business-customer class generated 20 new accounts, 89,000 deposits and withdrawals, and 24,000 other transactions. The implementation of ABC at all branches of BSSB provided sufficient data for internal benchmarking. The following are the lowest activity costs among all branches implementing two-stage ABC systems: Activity Open new accounts Tellers $ The Cumberland branch has the following cost data for the last year. $ 390,000 RSM salaries and benefits 220,000 Managing officer salary and benefits 140.000 Other bank costs 450,000 $ Total 1,200,000 The "other bank costs" include depreciation on the facility including furniture, building, equipment, insurance, rentals of computers, contracted computer services, telecommunications, and utilities. These costs cannot be directly or indirectly related to routine bank activities, such as processing new accounts or processing deposits or withdrawals, and, thus, are unallocated. There are no costs that can be traced directly to customers so the Cumberland branch has just two types of costsindirect and unallocated 78,000 11.000 Retail sales managers $ 89,000 Total traceable cost Activity Open new account Process deposits and withdrawals Resource Allocated cost ss th Activity Process deposits and withdrawals $ Lowest Activity Cost per Driver Unit $172.65 per new account $2.09 per deposit or withdrawal $3.58 per transaction Lowest Customer Cost per Account $129.18 $782.10 per Tellers Retail sales managers Process other transactions 195,000 33.000 21,000 Uni Customer Class Managing officers Print Done Retail $ 249,000 Commercial Total traceable cost Activity Process other Resource Allocated cost Tellers $ 78,000 Print Done transactions Retail sales managers - X 55,000 35,000 Data Table Managing officers $ Total traceable cost 168,000 Annual Flow of Cost Driver Print Done 580 Activity Cost Driver Process new accounts Number of new accounts Process deposits and withdrawals Number of deposits and withdrawals Process other transactions Number of other transactions 167,000 49,000 Print Done