Kates Kale Chips produces a healthy snack made primarily of kale. Each bag of the product sells for $5. The company computes the manufacturing overhead rate on a quarterly basis based upon the planned number of units to be produced that quarter. The following data are from Kates Kale Chipss projections for the upcoming quarter:

	Projections
Sales		27,000	bags
Production		29,000	bags
Variable manufacturing cost per bag	$	3.40
Sales and distribution costs per bag	$	0.35
Total fixed manufacturing overhead	$	49,300
Fixed administrative overhead	$	25,000

Required:

1.	Compute the projected product cost per bag produced under absorption costing.