Palisade Bank has three revenue generating areas: checking accounts, savings accounts, and loans. The bank also has three service areas: administration, personnel, and accounting. The direct costs per month and the interdepartmental service structure are shown below in a benefits provided ranking.
|
Direct |
|||||||
|
Department |
Costs |
Admin. |
Personnel |
Accounting |
Checking |
Savings |
Loan |
|
Administration |
$90,000 |
10 |
10 |
30 |
40 |
10 |
|
|
Personnel |
60,000 |
10 |
10 |
30 |
20 |
30 |
|
|
Accounting |
90,000 |
10 |
40 |
20 |
20 |
||
|
Checking |
90,000 |
10 |
|||||
|
Savings |
75,000 |
||||||
|
Loans |
150,000 |
Compute the total cost for each revenue generating area using the direct method.