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Che Hannibal Steel Company has a Transport Services Department that provides trucks to haul ore from the company's mine to its two steel mills-the Northern

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Che Hannibal Steel Company has a Transport Services Department that provides trucks to haul ore from the company's mine to its two steel mills-the Northern Plant and the Southern Plant. Budgeted costs for the Transport Services Department total $310,400 per year, consisting of $0.21 per ton variable cost and $260,400 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 52% of the Transport Services Department's capacity and the Southern Plant requires 48%. During the year, the Transport Services Department actually hauled 128,000 tons of ore to the Northern Plant and 57,200 tons to the Southern Plant. The Transport Services Department incurred $368,000 in cost during the year, of Which $53,000 was variable cost and $315,000 was fixed cost. Required: 1. How much of the Transport Services Department's variable costs should be charged to each plant? 2. How much of the $315,000 in fixed cost should be charged to each plant? 3. Should any of the Transport Services Department's actual total cost of $368,000 be treated as a spending variance and not charged to the plants? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3

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