Response to the following problem:
Robert Company's power plant provides electricity to two producing departments. The annual budget for the power plant shows the following:
Budgeted fixed costs $500,000
Budgeted variable costs per kilowatt hour $1
Actual annual costs incurred by the power plant were:
Actual fixed costs $215,000
Actual variable costs $350,000
Additional annual data follows:
Producing Department 1 Producing Department 2
Capacity available 250,000 kilowatt hours 150,000 kilowatt hours
Capacity used 270,000 kilowatt hours 165,000 kilowatt hours
Required:
A) Compute the amount of fixed costs allocated to each producing department.
B) Compute the amount of variable costs allocated to each producing department.