Hi-Tek Manufacturing Inc. makes two types of industrial component partsthe B300 and the T500. An absorption costing income statement for the most recent period is shown below:

Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin 1,707.200 1,215,484 491,716 s Selling and administrative expenses 610,000 Net operating loss S (118,284) Hi-Tek produced and sold 60,400 units of B300 at a price of $20 per unit and 12,800 units of T500 at a price of S39 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 $ 400,300 162,700 $ 563,000 162,300 490,184 $120,100 S 42,200 Cost of goods sold S 1,215,484 The company has created an activity-based costing system to evaluate the profitability of its products. Hi- Tek's ABC implementation team concluded that $52,000 and $106,000 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 T500 Total Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs) 8300 Overhead $203,224 125,160 101,800 60,000 90,200 62,600 152,800 298 78 220 NA NA NA Total manufacturing overhead cost S 490,184