The operations vicepresident of the Regal Bank of Canada Kri

The operations vice-president of the Regal Bank of Canada, Kristin Wu, has been interested in investigating the efficiency of the bank\'s operations. She has been particularly concerned about the costs of handling routine transactions at the bank and would like to compare these costs at t the branches with the most efficient operations can be identified, their methods can be studied and then replicated elsewhere. While the bank maintains meticulous records of wages and other costs, there has been no attempt thus far to show how those costs are related to the various services provided by the bank. Wu has asked for your help in conducting an ABC study of bank operations. In particular, she would like to know the cost of opening an account, the cost of processing deposits and withdrawals, and the cost of processing other customer transactions he bank\'s various branches. If The Windsor branch of the Regal Bank of Canada submitted the following cost data for last year: Teller wages Assistant branch manager salary Branch manager salary $172,000 81,000 101,500 Total $354,500 Virtually all of the other costs of the branch-rent, depreciation, utilities, and so on-are organization- sustaining costs that cannot be meaningfully assigned to individual customer transactions, such as depositing cheques In addition to the cost data above, the employees of the Windsor branch have been interviewed concerning how their time was distributed last year across the activities included in the ABC study. The results of those interviews appear below: Distribution of Resource Consumption across Activities Processing Processing Opening Deposits and Other Customer Other Teller wages Assistant branch manager salary Accounts Withdrawals Transactions Activities Totals 100% 100% 100% 0% 10% 0% 75% 20% 0% 15% 25% 10% 10% 45% 90% ranch manager salary

Solution

Answer

paricular	opening accounts	processsing deposits and withdrawals	processing other customer transactions	other activities	total
teller wages	0	129000	25800	17200	172000
assistant branch manager salary	8100	16200	20250	36450	81000
branch manager salary	0	0	10150	91350	101500
total cost