Exercise $10-32($Algo$)$ Activity$-$Based Costing of Customers $($LO $10-3,4)$

Rock Solid Bank and Trust $($RSB$\backslash$&T$)$ offers only checkIng accounts. Customers can write checks and use a network of automated teller machines. RSB$\backslash$&T earns revenue by Investing the money deposited; currently, it averages $6\mathrm{.}40$ percent annually on its investments of those deposits. To compete with larger banks, RSB$\backslash$&T pays depositors $0\mathrm{.}50$ percent on all deposits. A recent study classified the bank's annual operating costs into four activitles.

Data on two representative customers follow.

Required:

a$.$ Compute RSB$\backslash$&T$\text{'}$s operating profits.

b$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are based only on deposits. Interest costs $=0\mathrm{.}50$ percent of deposits; operating costs are $4$ percent $(\backslash (=\backslash$$ $33,000,000/\backslash$$ $825,000,000\backslash ))$ of deposits.

c$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are computed using the Information in the activity$-$based costing analysis.

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Compute the profit from Customer A and Customer B$,$ assuming that customer costs are based only on deposits. Interest costs $\backslash (=\backslash \{\backslash \{0\mathrm{.}5$: $\backslash$#$,\backslash$# $\backslash$# $0\mathrm{.}00\backslash \}\backslash \}\backslash )$ percent of deposits; operating costs are $4$ percent $(\backslash (=\backslash$$ $33,000,000/\backslash$$ $825,000,000\backslash ))$ of deposits. $($Do not round intermediate calculations. Round your answers to $2$ decimal places.$)$ Exercise $10-32($Algo$)$ Activity$-$Based Costing of Customers $($LO $10-3,4)$

Rock Solid Bank and Trust $($RSB$\backslash$&T$)$ offers only checkIng accounts. Customers can write checks and use a network of automated teller machines. RSB$\backslash$&T earns revenue by Investing the money deposited; currently, it averages $6\mathrm{.}40$ percent annually on its investments of those deposits. To compete with larger banks, RSB$\backslash$&T pays depositors $0\mathrm{.}50$ percent on all deposits. A recent study classified the bank's annual operating costs into four activitles.

Data on two representative customers follow.

Required:

a$.$ Compute RSB$\backslash$&T$\text{'}$s operating profits.

b$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are based only on deposits. Interest costs $=0\mathrm{.}50$ percent of deposits; operating costs are $4$ percent $(\backslash (=\backslash$$ $33,000,000/\backslash$$ $825,000,000\backslash ))$ of deposits.

c$.$ Compute the profit from Customer A and Customer B$,$ assuming that customer costs are computed using the Information in the activity$-$based costing analysis.

Answer is not complete.

Complete this question by entering your answers in the tabs below.

Compute the profit from Customer A and Customer B$,$ assuming that customer costs are based only on deposits. Interest costs $\backslash (=\backslash \{\backslash \{0\mathrm{.}5$: $\backslash$#$,\backslash$# $\backslash$# $0\mathrm{.}00\backslash \}\backslash \}\backslash )$ percent of deposits; operating costs are $4$ percent $(\backslash (=\backslash$$ $33,000,000/\backslash$$ $825,000,000\backslash ))$ of deposits. $($Do not round intermediate calculations. Round your answers to $2$ decimal places.$)$