Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations.

Month	Labor-Hours			Machine-Hours			Overhead Costs
1		730			1,358		$	102,771
2		720			1,409			103,758
3		675			1,522			109,913
4		740			1,445			108,318
5		780			1,589			116,295
6		745			1,569			114,589
7		750			1,399			106,962
8		725			1,316			102,080
9		715			1,459			106,359
10		800			1,550			113,037
11		680			1,290			100,355
12		710			1,604			113,072

Required:

a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours.

b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?