answer this question

Ahmad Company produces two products, M and Z. In the year ending 30 April 2020, it produced 6,000 M and 12,500 Z and incurred costs of $1,850,000

The costs incurred are such that 30% are variable. 60% of these variable costs vary with the number of Z produced, with the remainder varying with the output of M.

The budget for the three months to 31 October 2020 is being prepared using an incremental approach based on the following:

All costs will be 6% higher than the average paid in the year ended 30 April 2020.

Efficiency levels will be unchanged.

Expected output:

M 1,350 units

Z 6,890 units

Instructions:

What is the budgeted cost for the output of M (to the nearest $100) for the 3 months ending 31 October 2020?