The Ramon Company is a manufacturer that is interested in developing a cost formula to estimate the fixed and variable components of its monthly manufacturing overhead costs. The company wishes to use machine-hours as its measure of activity and has gathered the data below for this year and last year:

	Last Year				This Year
Month	Machine- Hours	Overhead Costs			Machine- Hours	Overhead Costs
January	21,200	$	85,000		21,200	$	87,000
February	23,300	$	101,000		22,300	$	95,000
March	20,300	$	89,700		21,300	$	93,200
April	21,300	$	90,200		20,300	$	87,200
May	22,100	$	81,700		18,100	$	80,200
June	17,100	$	76,500		16,100	$	77,500
July	14,200	$	71,500		12,200	$	68,500
August	9,100	$	65,500		13,200	$	72,000
September	10,500	$	70,000		15,200	$	74,500
October	17,200	$	76,000		17,200	$	73,500
November	16,200	$	72,500		15,200	$	72,000
December	17,600	$	79,000		16,100	$	76,000

The company leases all of its manufacturing equipment. The lease arrangement calls for a flat monthly fee up to 18,000 machine-hours. If the machine-hours used exceeds 18,000, then the fee becomes strictly variable with respect to the total number of machine-hours consumed during the month. Lease expense is a major element of overhead cost.

4.

Assume that the company consumes 22,700 machine-hours during a month. Using the high-low method, estimate the total overhead cost that would be incurred at this level of activity. Be sure to consider only the data points contained in the relevant range of activity when performing your computations. (Do not round intermediate calculations. Omit the "$" sign in your response)

Total overhead cost?