#4

Social Media, Inc. (SMI) has two services for users. Toot!, which connects tutors with students who are looking for tutoring services, and TiX, which can be used to buy, sell, or exchange event tickets. For the following year, SMI expects the following results. Users Revenues Engineering hours Engineering cost Administrative costs Toot: Tix 13,100 20,100 $ 1,800,000 $1,760,000 9,300 7,300 $ 687,750 $ 806,250 Total 33,200 $ 3,560,000 16,600 $ 1,494,000 $ 1,195,200 Required: a. Compute the predetermined overhead rate used to apply administrative costs to the two services assuming SMI uses the number of users to allocate administrative costs. b. Based on the rates computed in requirement (a), what is the profit for each service? Complete this question by entering your answers in the tabs below. Required A Required B Compute the predetermined overhead rate used to apply administrative costs to the two services assuming SMI the number of users to allocate administrative costs. Predetermined overhead rate per user Required A Required B Based on the rates computed in requirement (a), what is the profit for each service? Profit Service Toot! TIX