Hi$-$Tek Manufacturing, Inc., makes two types of industrial component parts$-$the B$300$ and the T$500.$ An

absorption costing income statement for the most recent period is shown:

Hi$-$Tek produced and sold $60,400$ units of B$300$ at a price of $$20$ per unit and $12,600$ units of T$500$ 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:

The company has created an activity$-$based costing system to evaluate the profitability of its products.

Hi$-$Tek's ABC implementation team concluded that $$53,000$ and $$104,000$ 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:

Required:

$1.$ Compute the product margins for the B$300$ and T$500$ under the company$$s traditional costing system.

$2.$ Compute the product margins for B$300$ and T$500$ under the activity$-$based costing system.

$3.$ Prepare a quantitative comparison of the traditional and activity$-$based cost assignments.