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Hannibal Steel Company's Transport Services Department provides trucks to haul ore from the company's mine...

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Accounting

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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 millsthe Northern Plant and the Southern Plant. Budgeted costs for the Transport Services Department total $169,400 per year, consisting of $0.24 per ton variable cost and $119,400 fixed cost. The level of fixed cost is determined by peak-period requirements. During the peak period, the Northern Plant requires 67% of the Transport Services Department's capacity and the Southern Plant requires 33%. During the year, the Transport Services Department actually hauled 120,000 tons of ore to the Northern Plant and 60,800 tons to the Southern Plant. The Transport Services Department incurred $363,000 in cost during the year, of which $52,100 was variable and $310,900 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 $363,000 should be treated as a spending variance and not charged to the plants

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