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cost ch4 - 47 Activity Dictionary Credit Card Department...

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4–7 Activity Dictionary: Credit Card Department Activity Name Activity Description Activity Type Cost Object(s) Activity Driver Supervising employees Scheduling, coordinating, and performance evaluation Secondary Activities within department Total labor time for each activity Processing transactions Sorting, keying, and verifying Primary Credit cards Number of transactions Issuing statements Reviewing, printing, stuffing, and mailing Primary Credit cards Number of statements Answering questions Answering, logging, reviewing data- base, callbacks Primary Credit cards Number of calls Providing ATM services Accessing accounts, withdrawing funds Primary Credit cards, checking and savings accounts Number of teller transactions
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4–8 1. Labor cost is assigned to the activities using direct tracing and a resource driver (percentage of time) : Supervising employees $64,600 (direct tracing) Processing transactions$84,000 (0.40 × $210,000) Issuing statements $63,000 (0.30 × $210,000) Answering questions $63,000 (0.30 × $210,000) Computer, desk, and printer resources are divided evenly among the labor types and then assigned to activities using direct tracing and a resource driver (percentage of computer time) : Supervising employees* $4,900 (direct tracing) Processing transactions$24,010(0.70 × $34,300) Issuing statements $6,860(0.20 × $34,300) Answering questions $3,430(0.10 × $34,300) Note: One-eighth of the cost is assigned by even division to the supervisor [($32,000 + $7,200)/8 = $4,900]. The residual ($39,200 – $4,900 = $34,300) is assigned to the clerical group and then traced to the activities in proportion to hours of computer usage. Telephone cost is assigned to two activities: Supervising employees** $500 (direct tracing) Answering questions $3,500(direct tracing) ATM cost is computed using transactions as the resource driver: Providing ATM services $250,000 (0.20 × $1,250,000) Thus, adding the costs assigned, we obtain the following activity costs: Supervising employees $70,000($64,600 + $4,900 + $500) Processing transactions$108,010($84,000 + $24,010) Issuing statements $69,860($63,000 + $6,860) Answering questions $69,930($63,000 + $3,430 + $3,500) Providing ATM services $250,000 * ($32,000 + $7,200)/8 = $4,900 × 100%) ** ($4,000/8) = $500 per telephone × 100%
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4–8 Concluded 2. The cost of supervision is assigned to the following primary activities (using relative labor content of each activity): Processing transactions$108,010 + (0.40
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