Community Bank Commercial Loan Evaluation with ABC: A Case Study

• In Event: Teaching Resources: Managerial and Cost Accounting

Abstract

The purpose of this case study is to examine one community bank with issues similar to those faced by others in the industry, and demonstrate how Activity-Based Costing (ABC) can help provide managers with information to address these issues. This study focuses on the commercial lending department at the bank, with the intent to determine the commercial lending products that are least and most profitable for the bank using ABC costing. The study concludes with suggestions for the bank based on these findings.

Authors

• Mehmet C Kocakulah, University of Southern Indiana

• Jan Taylor Morris, Sam Houston State University

• Matthew Yeager, Spring Leaf Financial