The Savings Bank of Sarasota Has Three Revenue-Generating Departments: Checking

question 6

Multiple Choice

The Savings Bank of Sarasota has three revenue-generating departments: 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: $$\begin{array}{l}\text { Percentage of Service Used by }\\\begin{array} { | l | c | c | c | c | c | c | c } \hline \text { Dept. } & \text { Costs } & \text { Admin. } & \text { Pers. } & \text { Acctg. } & \text { Check. } & \text { Sav. } & \text { Loc } \\\hline \text { Administration } & \$ 40,000 & - & 10 & 10 & 40 & 20 & 21 \\\hline \text { Personnel } & 23,000 & 10 & - & 10 & 20 & 40 & 21 \\\hline \text { Accounting } & 30,000 & 10 & 10 & - & 20 & 20 & 41 \\\hline \text { Checking } & 41,000 & & & & & & \\\hline \text { Savings } & 25,000 & & & & & & \\\hline \text { Loans } & 16,000 & & & & & & \\\hline\end{array}\end{array}$$ The Savings Bank of Sarasota uses the sequential (step) method and the service departments are allocated in the following order: administration, personnel, and accounting. How much cost would be allocated to the loan area from the personnel department using the sequential/step method? (Round to two decimal places.)

• A)$4,600.00
• B)$6,000.00
• C)$5,111.11
• D)$7,666.67

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Definitions:

Duty

What one ought to do, whether by virtue of his or her place or position in society (in Plato or Aristotle, for example) or by virtue of rational moral principles (as in Kant).

Obligation

A duty or commitment that one is bound to by law, promise, moral principles, or social custom.

Social Contract

A theory in political philosophy suggesting that the legitimacy of authority comes from an implicit agreement between the governing and the governed.

Legitimacy

The general belief that a rule, institution, or leader has the right to govern or dictate.