diff --git a/data/examples/declaration/value/function/block-arguments-out.hs b/data/examples/declaration/value/function/block-arguments-out.hs
index 1a29c1e..499173c 100644
--- a/data/examples/declaration/value/function/block-arguments-out.hs
+++ b/data/examples/declaration/value/function/block-arguments-out.hs
@@ -1,13 +1,11 @@
 f1 = foo do bar
 
-f2 =
-  foo do
-    bar
+f2 = foo do
+  bar
 
-f3 =
-  foo case True of
-    True -> bar
-    False -> baz
+f3 = foo case True of
+  True -> bar
+  False -> baz
 
 f4 = foo let a = 3 in b
 
@@ -25,6 +23,5 @@ f6 =
 
 f7 = foo \x -> y
 
-f8 =
-  foo \x ->
-    y
+f8 = foo \x ->
+  y
diff --git a/data/examples/declaration/value/function/record-constructors-out.hs b/data/examples/declaration/value/function/record-constructors-out.hs
index b91984a..baa780e 100644
--- a/data/examples/declaration/value/function/record-constructors-out.hs
+++ b/data/examples/declaration/value/function/record-constructors-out.hs
@@ -15,13 +15,12 @@ aLongVariableName =
       aLongRecordFieldName = YetAnotherLongRecordName
         { yetAnotherLongRecordFieldName = "a long string"
           },
-      aLongRecordFieldName2 =
-        Just YetAnotherLongRecordName
-          { yetAnotherLongRecordFieldName = "a long string",
-            yetAnotherLongRecordFieldName =
-              Just
-                "a long string"
-            },
+      aLongRecordFieldName2 = Just YetAnotherLongRecordName
+        { yetAnotherLongRecordFieldName = "a long string",
+          yetAnotherLongRecordFieldName =
+            Just
+              "a long string"
+          },
       aLongRecordFieldName3 = do
         foo
         bar
diff --git a/src/Ormolu/Printer/Meat/Declaration/Value.hs b/src/Ormolu/Printer/Meat/Declaration/Value.hs
index 6fb9ca4..63c35d2 100644
--- a/src/Ormolu/Printer/Meat/Declaration/Value.hs
+++ b/src/Ormolu/Printer/Meat/Declaration/Value.hs
@@ -59,6 +59,7 @@ data Placement
   | Hanging                     -- ^ Expressions that have hanging form
                                 -- should use it and avoid bumping one level
                                 -- of indentation
+  deriving (Eq)
 
 p_valDecl :: HsBindLR GhcPs GhcPs -> R ()
 p_valDecl = \case
@@ -512,11 +513,34 @@ p_hsExpr = \case
     txt "\\case"
     breakpoint
     inci (p_matchGroup LambdaCase mgroup)
-  HsApp NoExt f x -> sitcc $ do
-    located f p_hsExpr
-    -- Second argument can be a `do` or `case` block with `-XBlockArguments`.
-    placeHanging (exprPlacement (unLoc x)) $
-      located x p_hsExpr
+  HsApp NoExt f x -> do
+    -- We hang only the last function argument. In order to do
+    -- this, we only call 'placeHanging' on the topmost 'HsApp',
+    -- and then use 'p_withoutHanging' for the descendants.
+    let p_withoutHanging (HsApp NoExt f' x') = do
+          case f' of
+             (L _ (HsApp _ _ _)) -> located f' p_withoutHanging
+             _ -> located f' p_hsExpr
+          breakpoint
+          inci $ located x' p_hsExpr
+        p_withoutHanging e = p_hsExpr e
+        -- Only use the hanging placement if the function spans
+        -- a single line.
+        placement =
+          if isOneLineSpan (getLoc f)
+          then exprPlacement (unLoc x)
+          else Normal
+        -- We only sit when the last expression is not hanging.
+        -- This is to allow:
+        --   f = foo bar do
+        --     baz
+        sit' = if placement == Normal
+               then sitcc
+               else id
+    sit' $ do
+      useBraces $ located f p_withoutHanging
+      placeHanging placement $
+        located x p_hsExpr
   HsAppType a e -> do
     located e p_hsExpr
     breakpoint
@@ -1091,6 +1115,8 @@ exprPlacement = \case
   -- whole block hanging; so that we can use the common @f = foo $ do@
   -- style.
   OpApp NoExt _ _ y -> exprPlacement (unLoc y)
+  -- Same thing for function applications (usually with -XBlockArguments)
+  HsApp NoExt _ y -> exprPlacement (unLoc y)
   HsProc NoExt (L s _) _ ->
     -- Indentation breaks if pattern is longer than one line and left
     -- hanging. Consequently, only apply hanging when it is safe.