Citizens Bank has two bank locations: Main and Suburbs. The central office provides check-processing services for the two banks. Information pertaining to the banks is as follows:

a. Use the direct method to allocate the check-processing center costs to each bank to provide information for setting service charges.
b. Use the direct method to allocate the check processing center costs to each bank for performance evaluation purposes.
c. Determine the costs of the check-processing center NOT allocated to the two banks. Why were these costs not allocated to the operating units?

Question

Citizens Bank has two bank locations: Main and Suburbs. The central office provides check-processing services for the two banks. Information pertaining to the banks is as follows:
   
a. Use the direct method to allocate the check-processing center costs to each bank to provide information for setting service charges.
b. Use the direct method to allocate the check processing center costs to each bank for performance evaluation purposes.
c. Determine the costs of the check-processing center NOT allocated to the two banks. Why were these costs not allocated to the operating units?

Quizplus · Accepted Answer

The Answer of Citizens Bank has two bank locations: Main and Suburbs. The central office provides check-processing services for the two banks. Information pertaining to the banks is as follows:
   
a. Use the direct method to allocate the check-processing center costs to each bank to provide information for setting service charges.
b. Use the direct method to allocate the check processing center costs to each bank for performance evaluation purposes.
c. Determine the costs of the check-processing center NOT allocated to the two banks. Why were these costs not allocated to the operating units?

Citizens Bank Has Two Bank Locations: Main and Suburbs