Buffalo Ltd manufactures filing cabinets in two operations, machining and finishing. It provides the following information:

	Machining	Finishing
Annual capacity	157,000 units	96,000 units
Annual production	78,000 units	78,000 units
Fixed operating costs (excl. d.m.)	$508,000	$593,000
Fixed operating costs per unit produced	$7 per unit	$7 per unit

Each cabinet sells for $71 and has direct materials costs of $42 incurred at the start of the machining operation. Buffalo Ltd has no other variable costs. Buffalo Ltd can sell whatever output it produces. The following requirements refer only to the preceding data. There is no connection between the requirements

Buffalo Ltd produces 4,000 defective units at the machining operation. Enter the amount of the cost to Buffalo Ltd of the defective items produced.

Answer: