Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Question - ABC Costing for a Service Organization
First Mortgage Company is a full-service residential mortgage company in the Baltimore area that operates in a very competitive market. The manager, Richard Sissom, is concerned about operating costs associated with processing mortgage applications and haas decided to install an ABC costing system to help him get a handle on costs. Although labor hours seems to be the primary driver of the cost of processing a new mortgage, the labor cost for the different activities involved in processing new loans varies widely. The Accounting Department has provided the following data for the company's five major cost pools for 2009.
Activity Cost Pools
Activity Drivers
Taking Customer Applications
$300,000
Time-Assistant Managers
12,000 hours
Conducting credit investigations
450,000
Time-Credit Managers
16,500 hours
Underwriting
500,000
Time-Underwriting Department
10,000 hours
Preparing loan packages
200,000
Time-Processing Department
Closing loans
600,000
Time-Legal Department hours
6,000 hours
$2,050,000
54,500 hours
During 2009, the company processed and issued 5,000 new mortgages, two of which are summarized here with regard to activites used to process the mortgages.
Loan 5066
Loan 5429
Application processing hours
1.5
2.75
Credit investigating hours
4
3
Underwriting hours
2.5
4.75
Processing hours
3.5
Legal processing hours
Total Hours
13
15
Question:
a) Determine the cost per unit of activity for each activity cost pool.
b) Determine the cost of processing loans 5066 and 5429.
c) Determine the cost of preparing loans 5066 and 5429 assuming that an average cost per hour for all activates is used.
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.
Accounting problems, Draw a detailed timeline incorporating the dividends, calculate the exact Payback Period b) the discounted Payback Period. the IRR, the NPV, the Profitability Index.
Term Structure of Interest Rates
Write a report on Internal Controls
Prepare the bank reconciliation for company.
Create a cost-benefit analysis to evaluate the project
Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR
Distinguish between liquidity and profitability.
Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.
Simple Interest, Compound interest, discount rate, force of interest, AV, PV
CAPM and Venture Capital
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd