tion of the various types of financial services, by the alternative methods for the costing of such services, and by the complex array factors involved in such costing. This problem was examined in this research study.
Considering the complexity of the issue of bank product costing, this study was not based on an assumption that some specific formula either existed or could be developed that would solve the bank product costing problem for all commercial banks. It was assumed, however, that a single methodological approach to bank product costing could be structured that would be sufficiently flexible to permit its successful application by commercial banks with diverse markets and products. In this context, it was hypothesized that an effective methodological approach to bank product costing that may be successfully applied to a wide variety of bank products is one that is characterized
2"Fee Income Forges Superior Earners," US Banker, July 1992, 38.
3"Fees Main Reason Customers Leave Bank," Bank Management, 68 (January 1992): 6.
by a two-stage activity-based cost accounting procedure in the assessment of costs and determination of product pricing.
The purpose of this research study was to develop a body of knowledge that will facilitate the development by commercial banking managers of effective procedures for the costing of various types of financial services during the remainder of the 1990s and in the early-years of the next century. Within the context of this study purpose, the intent of this study was the development of a methodological approach that may be effectively applied to a wide range of bank products.
Some specialized terms related to cost accounting procedures were used in this study. While the definitions of these terms are important to this study, they may be better understood when used in context. Thus, the definitions of these terms are provided at those points in the text of the study wher...