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 below: Hi-Tek Manufacturing Inc Income Statement 1,708,000 Sales Cost of goods sold 1,212,660 Gross margin 495,340 600,000 Selling and administrative expenses Net operating loss (104,660) Hi-Tek produced and sold 60,200 units of B300 at a price of $20 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: B300 T500 Total 400,400 2,500 562,900 Direct materials 120,200 42,100 Direct labor 162,300 487,460 Manufacturing overhead 1,212,660 Cost of goods sold The company has created an activity-based costing system to evaluate the profitability of its products. Hi- Tek's ABC implementation team concluded that $55,000 and $108,000 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