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		715			1,352		$	102,761
2		720			1,405			103,815
3		680			1,515			109,963
4		740			1,447			108,207
5		780			1,598			116,274
6		755			1,583			114,475
7		745			1,399			107,043
8		720			1,318			102,058
9		710			1,446			106,336
10		800			1,542			113,088
11		685			1,298			99,088
12		700			1,612			111,177

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?