Elite Lawn & Plowing (EL&P) is a lawn and snow plowing service with both residential and commercial clients. The owner believes that the commercial sector has more growth opportunities and is considering dropping the residential service. Twenty employees worked a total of 38,000 hours last year, 27,000 on residential jobs and 11,000 on commercial jobs. Wages were $16 per hour for all work done. Any materials used are included in overhead as supplies. All overhead is allocated on the basis of labor-hours worked, which is also the basis for customer charges. Because of increased competition for commercial accounts, EL&P can charge $34 per hour for residential work, but only $27 per hour for commercial work. Required:

a. If overhead for the year was $117,140, what were the profits of the residential and commercial services using labor-hours as the allocation base? (Do not round intermediate calculations. Round final answers to the nearest whole dollar.)

b. Overhead consists of costs of traveling to the site, using equipment (including vehicle rental), and using supplies, which can be traced as follows.

				Cost Driver Volume
Activity	Cost Driver	Cost			Commercial			Residential
Traveling	Number of clients served	$	15,000			15			45
Using equipment	Equipment hours		39,440			4,000			1,800
Using supplies	Area serviced in square yards		62,700			110,000			80,000
Total overhead		$	117,140

Check my wor Elite Lawn & Plowing (EL&P) is a lawn and snow plowing service with both residential and commercial clients. The owner believes that the commercial sector has more growth opportunities and is considering dropping the residential service. Twenty employees worked a total of 38,000 hours last year, 27,000 on residential jobs and 11,000 on commercial jobs. Wages were $16 per hour for all work done. Any materials used are included in overhead as supplies. All overhead is allocated on the basis of labor-hours worked, which is also the basis for customer charges. Because of increased competition for commercial accounts, EL&P can charge $34 per hour for residential work, but only $27 per hour for commercial work. Required: a. If overhead for the year was $117,140, what were the profits of the residential and commercial services using labor-hours as the allocation base? (Do not round Intermediate calculations. Round final answers to the nearest whole dollar.) b. Overhead consists of costs of traveling to the site, using equipment (including vehicle rental), and using supplies, which can be traced as follows. Cost Driver Volume Activity Cost Driver Commercial Residential Traveling Number of clients served $ 15,000 Using equipment Equipment hours 39,440 4,000 1,800 Using supplies Area serviced in square yards 62,700 110,000 80,000 Total overhead $ 117, 140 Cost 15 45 Recalculate profits for commercial and residential services based on these activity bases. (Do not round Intermediate calculations. Round final answers to the nearest whole dollar.) Commercial Residential a Revenue Direct Labor Overhead Profit b. Total Overhead Profit