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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

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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 $191, 200 per year, consisting of $0.2 per ton variable cost and $141, 200 fixed cost. The level of fixed cost Is determined by peak-period requirements. During the peak period, the Northern Plant requires 51% of the Transport Services Department's capacity and the Southern Plant requires 49%. During the year, the Transport Services Department actually hauled the following amounts of ore for the two plants: Northern Plant, 121,000 tons; Southern Plant, 68, 100 tons. The Transport Services Department incurred $368,000 in cost during the year, of which $53, 400 was variable cost and $314, 600 was fixed cost. Required: Determine how much of the $53, 400 in variable cost should be charged to each plant. Determine how much of the $314, 600 in fixed cost should be charged to each plant. Should any of the $368,000 in the Transport Services Department cost not be charged to the plants

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