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 the projections of Kates Kale Chips for the upcoming quarter:

	Projections
Sales		23,000	bags
Production		25,000	bags
Variable manufacturing cost per bag	$	2.60
Sales and distribution costs per bag	$	0.45
Total fixed manufacturing overhead	$	52,500
Fixed administrative overhead	$	21,000

Required:

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

2. Compute the projected product cost per bag under variable costing.