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es 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 $320,500 per year, consisting of $0.25 per ton variable cost and $270,500 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 68% of the Transport Services Department's capacity and the Southern Plant requires 32%. During the year, the Transport Services Department actually hauled 112,000 tons of ore to the Northern Plant and 62,700 tons to the Southern Plant. The Transport Services Department incurred $366,000 in cost during the year, of which $53,600 was variable cost and $312,400 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 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 variance 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 1 Required 2 >

es 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 $320,500 per year, consisting of $0.25 per ton variable cost and $270,500 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 68% of the Transport Services Department's capacity and the Southern Plant requires 32%. During the year, the Transport Services Department actually hauled 112,000 tons of ore to the Northern Plant and 62,700 tons to the Southern Plant. The Transport Services Department incurred $366,000 in cost during the year, of which $53,600 was variable cost and $312,400 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 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 variance 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 1 Required 2 >

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter10: Short-term Decision Making
Section: Chapter Questions
Problem 7PB: Remarkable Enterprises requires four units of part A for every unit of Al that it produces....
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es 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 $320,500 per year, consisting of $0.25 per ton variable cost and $270,500 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 68% of the Transport Services Department's capacity and the Southern Plant requires 32%. During the year, the Transport Services Department actually hauled 112,000 tons of ore to the Northern Plant and 62,700 tons to the Southern Plant. The Transport Services Department incurred $366,000 in cost during the year, of which $53,600 was variable cost and $312,400 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 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 variance 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 1 Required 2 >
Transcribed Image Text:es 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 $320,500 per year, consisting of $0.25 per ton variable cost and $270,500 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 68% of the Transport Services Department's capacity and the Southern Plant requires 32%. During the year, the Transport Services Department actually hauled 112,000 tons of ore to the Northern Plant and 62,700 tons to the Southern Plant. The Transport Services Department incurred $366,000 in cost during the year, of which $53,600 was variable cost and $312,400 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 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 variance 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 1 Required 2 >
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