Question: Direct Method Prosperous Bank has three support areas (administration, human resources, and accounting) and three revenue-generating areas (checking accounts, savings accounts, and loans). Monthly direct

Direct Method Prosperous Bank has three support areas (administration, human resources, and accounting) and three revenue-generating areas (checking accounts, savings accounts, and loans). Monthly direct deposit costs and the interdepartmental support structure are shown in the following benefits-provided ranking:

Percentage of Service Used By
Department Direct Cost Admin.

Human

Resource

Accounting Checking Savings Loans
Administration $540,000 10 10 30 40 10
Human Resources $360,000 10 10 30 20 30
Accounting $300,000 10 10 40 20 20
Checking $630,000
Savings $337,500
Loans $675,000

Compute the total cost for each revenue-generating are of the bank using the direct method.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!