Chapter 70 17 Problem 7-17 (Algo) Comparing Traditional and Activity-Based Product Margins [LO7-1, LO7-3, L07-4. LO7-5) 10 points eBook Smoky Mountain Corporation makes two types of hiking boots--the Xtreme and the Pathfinder. Data concerning these two product lines appear below Xtreme Pathfinder $ Selling price per unit 123.00 $ 86.00 Direct materials per unit $ 63.80 $ $ 50.00 Direct labor per unit $ 10.80 $ 9.00 Direct labor-hours per unit 1.2 DLHS 1.@ DLHS Estimated annual production 27,000 units 74,000 units and sales 00 Hint Print Reference The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below Estimated total manufacturing $ overhead 2,340,800 Estimated total direct labor-hours 106,408 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization sustaining costs and idle capacity costs Estimated Expected Activity Overhead Activities and Activity Measures Cost Xtrene Pathfinder Total Supporting direct labor direct labor-hours) $ 691,688 32,400 74,000 106,400 Batch setups (setups) 900,000 270 500 Product sustaining (number of products) 700,000 1 1 2 Other 49,200 NA NA Total manufacturing overhead $ cost 2,340,800 230 NAT Compute the product margins for the Xtreme and the Pathfinder products under the activity based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments Complete this question by entering your answers in the tabs below. Required Required Required Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. (Round your intermediate calculations to 2 decimal places.) Xtreme Pathfinder Product margin Total