75,000 Processing accounts 1,000 ssuing statements 295,000 Processing transactio

Question

75,000 Processing accounts 1,000 ssuing statements 295,000 Processing transactions 8,050 5,050 6,670 3,220 23,000 Phone and supples Salaries 29,000 Answering customer inquiries Total $490,000 Total Computers are used only by the issuing (30 percent) and processing transaction (70 percent) activities. Phone and supplies are 70 percent customer inquiries with the other 30 percent divided equally among the remaining activities, including supervising the checking operation. · . The supervisor spends 100 percent of his time on supervision. In addition to the 23,000 derical hours, there are 3,000 hours of supervision used (the hours used by the supervising clerks activity, which is not listed above). 1. Prepare a work distribution matrix for the five primary activities. If an answer is zero, enter "0" Golding Dank Percentage of Time on Each Activity Supervising clerks Processing accounts Issuing statements Processing transactions Answering customer inquiries Supervisor Clerks

Explanation / Answer

Solution:

1) Preparing a Work Distribution Matrix for the Five Primary Activities:

Golding Bank

Percentage of Time on Each Activity

2) Calculation of the Cost of Each Activity:

a. 70% * 91,000 for Customer Inquiries; 7.5% * 91,000 for Other Activities.

b. 100% * $75,000; 35% * $295,000; 22% * $295,000; 29% * $295,000; 14% * $295,000.

c. 30% * $29,000; 70% * $29,000

3) Calculation of the Final Cost of These Four Primary Activities:

The Costs are the Primary Activities and Supervising is the Secondary Activity,

a. $110,075 + (35% * $81,825)

b. $80,425 + (22% * $81,825)

c. $112,675 + (29% * $81,825)

d. $105,000 + (14% * $81,825)

Golding Bank

Percentage of Time on Each Activity

Activity Supervisor Clerks Supporting Calculation Supervising Clerks 100% 0% (3,000/3,000) Processing Accounts 0% 35% (8,050/23,000) Issuing Statements 0% 22% (5,060/23,000) Processing Transactions 0% 29% (6,670/23,000) Answering customers Inquiries 0% 14% (3,220/23,000)

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