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Assuming there are $2,000$ 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 $

A time equation is used to assign resource costs to checking accounts. Select a time equation for the interest$-$bearing checking account product.

$0\mathrm{.}20($number of accounts$)+0\mathrm{.}10($number of statements$)+0\mathrm{.}05($number of transactions$)+0\mathrm{.}15($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

What if process improvements decreased the number of customer inquiries, leading to a $10$ percent reduction in check processing hours and a $$7,200$ reduction in

total resource costs? Calculate the capacity cost rate for the checking account process. Round your answers to the nearest cent.

$

per hour

Update all the activity rates for these changes in operating conditions.

Processing accounts

Issuing statements

Processing transactions

$

$$

per account

$!$

per statement

Answering inquiries

$!$

per transaction

per inquiry

Simplifying the ABC System: TDABC

Supervision $$60,000$ Processing accounts $0\mathrm{.}20$ hr$.$ No$.$ of accounts $2,0001,500$

Phone and supplies $94,000$ Issuing statements $0\mathrm{.}10$ hr$.$ No$.$ of statements $60,00010,000$

Salaries $180,000$ Processing transactions $0\mathrm{.}05$ hr$.$ No$.$ of transactions $160,000120,000$

Computer $26,000$ Answering customer inquiries $0\mathrm{.}15$ hr$.$ No$.$ of inquiries $1,5001,500$

Total $360,000$

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

Calculate the activity rates for the four activities. Round your answers to the nearest cent.

Processing accounts $fill in the blank $2$

$3\mathrm{.}6$

per account

Issuing statements $fill in the blank $3$

$1\mathrm{.}8$

per statement

Processing transactions $fill in the blank $4$

$0\mathrm{.}9$

per transaction

Answering inquiries $fill in the blank $5$

$2\mathrm{.}7$

per inquiryFeedback

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Capacity cost rate $=$ Cost of resources supplied $$ Practical capacity of resources supplied

Ilse the colutinn of Renuirement $1$ and multinlv hv the time ner unit of an activitv to nhtain the activitv rate. This rate multinlied hv the total activitv nut

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