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		725			1,353		$	102,775
2		710			1,413			103,859
3		675			1,527			109,811
4		740			1,455			108,269
5		770			1,586			116,291
6		755			1,588			114,460
7		750			1,393			106,946
8		720			1,313			102,009
9		710			1,451			106,472
10		805			1,543			113,011
11		685			1,294			102,397
12		710			1,608			115,114

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 1,600 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?