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 HL-Tek Manufacturing Inc. Income Statement Sales $ 1,091,400 Cost of goods sold 1,212,078 Gross margin 479,322 Selling and administrative expenses 640,000 Tiet operating loss $ (169,678) Hi. Tek produced and sold 60.000 units of B300 at a price of $20 per unit and 12600 units of T500 at a price of $39 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. Direct materials Direct labor Hanufacturing overhead Cost of goods sold 3300 T5ce Total $400,000 $162.900 5 563,700 $ 120,200 42,200 162,400 485278 $1,212,678 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that 558,000 and 5106,000 of the company's advertising expenses could be directly traced to 8300 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 Activity activity Control and Activity Mease) verband 500 1500 Machining machine-hours) $ 205,940 10,200 62.000 152,200 Setups (setup hours) 120,830 71 210 Product Sustaining number of products) 100,00 other organization stating costs) 60.000 NA TA NA Total manufacturing overhead cost $ 485,78 1 2 Required: 1. Compute the product margins for the 8300 and T500 under the company's traditional costing system, 2. Comote the product margins for B300 and 1500 under the activity-based costing system 3. Presare a quantitative comparison of the traditional and activity based cost assements