Social Media, Inc. (SMI) has two services for users. Toot!, which connects workers 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.

	Toot!		TiX		Total
Users		15,500		22,100		37,600
Revenues	$	2,000,000	$	2,080,000	$	4,080,000
Engineering hours		10,400		8,400		18,800
Engineering cost	$	881,000	$	999,000	$	1,880,000
Administrative costs					$	1,504,000

Required:

a. Compute the predetermined overhead rate used to apply administrative costs to the two services assuming SMI uses the engineering cost to allocate administrative costs.

b. Based on the rates computed in requirement (a), what is the profit for each service?