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Hannibal Steel Company's Transport Services Department provides trucks to haul ore from the company's mine to its two steel mills- the Northern Plant and
Hannibal Steel Company's Transport Services Department 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 $260,200 per year, consisting of $0.17 per ton variable cost and $210,200 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 61% of the Transport Services Department's capacity and the Southern Plant requires 39%. During the year, the Transport Services Department actually hauled 125,000 tons of ore to the Northern Plant and 55,300 tons to the Southern Plant. The Transport Services Department Incurred $366,000 in cost during the year, of which $52,300 was variable and $313,700 was fixed. Required: 1. How much of the Transport Services Department's variable costs should be charged to each plant? 2 How much of the Transport Services Department's fixed costs should be charged to each plant? 3. How much, if any, of the Transport Services Department's actual total cost of $366,000 should be treated as a spending varlance and not charged to the plants? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 How much of the Transport Services Department's variable costs should be charged to each plant? Variable cost charged to Northern Plant Variable cost charged to Southern Plant Required 2 >
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