St. Kilda Enterprises produces parts for the electronics industry. The production manager and cost analyst reviewed the accounts for the previous month and have provided an estimated breakdown of the fixed and variable portions of manufacturing overhead.

	Fixed				Variable				Total
Indirect materials	$	2,600			$	7,600			$	10,200
Indirect labor		1,800				15,800				17,600
Supervision		8,600				2,800				11,400
Depreciation		35,600				3,600				39,200
Maintenance		15,600				20,600				36,200
Total	$	64,200			$	50,400			$	114,600

Direct materials for the month amounted to $95,500. Direct labor for the month was $190,500. During the month, 12,500 units were produced.

Required:

a. No changes are expected in these cost relations next month. The firm has budgeted production of 16,250 units. Provide an estimate for total production cost for next month.

	Cost Item	Next Month's Cost
Direct materials
Direct labor
Variable overhead
Fixed overhead
Maintenance
Total Costs

b. Determine the cost per unit of production for the previous month and the next month.

	Cost per Unit
Last Month
Next Month