- 1 - X Truck fleet information Cost information fonto Kdrive For the year, the trucking fleet had a practical capacity of 75 round trips between the Owen Sound plant and the two suppliers. It recorded the following information. ChocoMix Inc. decides to examine the effect of using the dual-rate method for allocating truck costs to each round trip. At the start of the year, the budgeted costs were as follows. Budgeted Actual Variable cost per round trip $ 1,050 $ 150,000 $ 143,500 Fixed costs 71,250 Costs of truck fleet Number of round trips for dark chocolate division (Owen Sound plant-Toronto) Number of round trips for milk chocolate division (Owen Sound plant-Barrie) 40 35 The actual results for the 70 round trips made in the year were as follows. 35 35 Variable costs $ tual r 61,500 82,000 Total costs Fixed costs $ 143,500 Rate per round trip Budgeted - Costs allocated by Dark chocolate Milk chocolate Budgeted round trips $ 80,000 $ 70,000 Actual round trips used 70,000 70,000 Actual round trips used 71,750 71,750 Required Budgeted Actual 1. Using the dual-rate method, what are the costs allocated to the dark chocolate division and the milk chocolate division when (a) variable costs are allocated using the budgeted rate per round trip and actual round trips used by each division and when (b) fixed costs are allocated based on the budgeted rate per round trip and round trips budgeted for each division? 2. From the viewpoint of the dark chocolate division, what are the effects of using the dual-rate method rather than the single-rate method? Print Done ChocoMix Inc. is a producer of premium chocolate based in Owen Sound. The company has a separate division for each of its two products: dark chocolate and milk chocolate. ChocoMix purchases ingredients from Toronto for its dark chocolate division and from Barrie for its milk chocolate division. Both locations are the same distance from ChocoMix's Owen Sound plant. ChocoMix Inc. operates a fleet of trucks as a cost centre that charges the divisions for variable costs (drivers and fuel) and fixed costs (vehicle amortization, insurance, and registration fees) of operating the fleet. Each division is evaluated on the basis of its operating income. (Click the icon to view the truck fleet information.) Click the icon to view the cost information for the year.) Required Requirement 1. Using the dual-rate method, what are the costs allocated to the dark chocolate division and the milk chocolate division when (a) variable costs are allocated using the budgeted rate per round trip and actual round trips used by each division and when (b) fixed costs are allocated based on the budgeted rate per round trip and round trips budgeted for each division? Dark chocolate Milk chocolate Variable costs Fixed costs Total costs