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
Sales	$	2,100,000
Cost of goods sold		1,600,000
Gross margin		500,000
Selling and administrative expenses		550,000
Net operating loss	$	(50,000)

Hi-Tek produced and sold 70,000 units of B300 at a price of $20 per unit and 17,500 units of T500 at a price of $40 per unit. The companys 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 companys two product lines is shown below:

	B300		T500		Total
Direct materials	$	436,300	$	251,700	$	688,000
Direct labor	$	200,000	$	104,000		304,000
Manufacturing overhead						608,000
Cost of goods sold					$	1,600,000

The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $50,000 and $100,000 of the companys 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 companys manufacturing overhead to four activities as shown below:

	Manufacturing		Activity
Activity Cost Pool (and Activity Measure)	Overhead		B300	T500	Total
Machining (machine-hours)	$	213,500	90,000	62,500	152,500
Setups (setup hours)		157,500	75	300	375
Product-sustaining (number of products)		120,000	1	1	2
Other (organization-sustaining costs)		117,000	NA	NA	NA
Total manufacturing overhead cost	$	608,000

1. Compute the product margins for the B300 and T500 under the companys traditional costing system.

	B300	T500	Total
Product margin

2. Compute the product margins for B300 and T500 under the activity-based costing system. (Negative product margins should be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.)

	B300	T500	Total
Product margin

3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your intermediate calculations to 2 decimal places and "Percentage" answer to 1 decimal place. (i.e. .1234 should be entered as 12.3))