Heidt Cleaning Services $($HCS$)$ is a local custodial service company serving both the residential and commercial

markets. The owner is considering dropping the commercial clients because that business seems only marginally

profitable.

Twenty$-$five employees worked a total of $39,900$ hours last year, $26,600$ on commercial jobs and $13,300$ on

residential jobs. Wages were $$20$ 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.

Given current economic conditions and competition, HCS bills residential clients $$40$ per hour and commercial

clients $$30$ per hour.

Required:

a$.$ If overhead for the year was $$358,140,$ what were the profits of the residential and commercial services using

labor$-$hours as the allocation base?

Note: Do not round intermediate calculations. Round final answers to the nearest whole dollar.

b$.$ Overhead consists of costs of supervision, equipment used $($including vehicle rental$),$ and supplies used, which

can be traced as follows:

Recalculate total overhead and profits for commercial and residential services based on these activity bases.

Note: Round intermediate calculations to $2$ decimal places.