I've heard that you should put aside at least $7000 per person for funeral expenses.
What type of attorney did you have draw up the previous paperwork? I was advised to see an Elder Law attorney rather than an accountant or financial advisor. An attorney who specializes in Elder Law will be better able to advise you concerning Medicaid and its effect on your financial decisions, etc.
It sure is scary having to be responsible for someone else's finances and hoping you're making wise decisions for them and you. Hope this helps and good luck!