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Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses 600,006 Net operating loss $1,712,000 1,217,676 494, 324 $(105,676) Hi-Tek produced and sold 60,200 units of B300 at a price of $20 per unit and 12,700 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: B300 T500 Total Direct materials Direct labor Manufacturing overhead Cost of goods sold $400, 300 $163,000 563,300 163,30e 491,076 $1,217,676 $120,900 $ 42,400 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $56,000 and $102,000 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: Manufacturing Activit Activity Cost Pool (and Activity Measure) Overhead B300 T500 Tota.l Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs) Total manufacturing overhead cost $291,696 128,48e 100,80e 60,100 $491,076 90 , 62, 5 72 220 152,800 292 NA NA NA Required 1. Compute the product margins for the B300 and T500 under the company's traditional costing system 2. Compute the product margins for B300 and T500 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 Complete this question by entering your answers in the tabs below. Required 1Required 2 Required 3 Compute the product margins for B300 and T500 under the activity-based costing system. (Negative product margins sh be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.) B300 T500 Total Product margin B300 T500 Total %of %of Amount Amount Amount Traditional Cost System rect materials irect labor anufacturing overhead Total cost assigned to products elling and administrative Total cost B300 T500 Total %of %of Amount Total Amount Amount Total Amount Amount Activity-Based Costing System Direct costs Direct materials Direct labor Advertising expense Indirect costs Machining Setups Product sustaining Total cost assigned to products Direct costs 5 Direct materials Direct labor Advertising expense Indirect costs Machining Setups Product sustaining Total cost assigned to products Costs not assigned to products: 0 0 0 Other Selling and administrative Total cost 0