2 Hi-Tek Manufacturing, Incorporated, makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown It-Tek Manufacturing Incorporated 7 Income Statement points Sales Cost of goods sold Sapped Gross margin Selling and administrative expenses Net operating loss Book $1,774,500 1,219,432 555,060 600,000 $ (44,932) Hi-Tek produced and sold 60,500 units of 8300 at a price of $21 per unit and 12,600 units of T500 at a price of $40 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Hint Direct materials Direct labor Manufacturing overhead Cost of goods sold 1300 $ 400,900 $ 120,600 +500 $162,400 $ 42,700 Total $ 563,200 163,300 492,932 References $1,219,432 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $53,000 and $107,000 of the company's advertising expenses could be directly traced to B300 and T500, respectively. The remainder of the selling and administrative expenses was organization-sustaining in nature. The ABC team also distributed the company's manufacturing overhead to four activities as shown below: Hanufacturing Overhead Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs) Total manufacturing overhead cost Required: $210,432 300 90,700 Activity 7500 Total 62,900 119,700 75 101,000 1 210 1 153,600 285 2 61,000 $492,932 NA NA 1. Compute the product margins for the 8300 and T500 under the company's traditional costing system, 2. Compute the product margins for 8300 and T500 under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Required 1 Required 2 Required 3 Compute the product margins for the B300 and T500 under the company's traditional costing system. (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.) Product margin B300 T500 Total Required 1 Required 2 > Required 1 Required 2 Required 3 Compute the product margins for B300 and T500 under the activity-based costing system. (Negative product marg be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.) Product margin B300 T500 Total $ < Required 1 Required 3> 2 puces ang Percentage answers to 3 Deumer pace and and ouer answers to the nearest whole donar amounts/ 7 points Traditional Cost System Skipped Amount 8300 % of Amount T500 % of Total Amount Total cost assigned to products $ 0 $ 0 Book Total cost $ 0 Print 10 10 8300 % of Amount Total Amount Amount Activity-Based Costing System Direct costs References Indirect costs T500 % of Total Amount Total Amount Total cost assigned to products Costs not assigned to products $ 0 $ 0 Total cost $ 0