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			1,358		$	102,759
2		710			1,402			103,867
3		680			1,513			109,967
4		735			1,448			108,200
5		775			1,585			116,253
6		765			1,576			114,422
7		735			1,388			106,954
8		735			1,304			102,189
9		715			1,448			106,318
10		800			1,547			113,094
11		675			1,286			98,817
12		720			1,606			111,457

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?