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:

Hi-Tek Manufacturing Inc. Income Statement
Sales	$	1,647,600
Cost of goods sold		1,215,400
Gross margin		432,200
Selling and administrative expenses		650,000
Net operating loss	$	(217,800	)

Hi-Tek produced and sold 60,400 units of B300 at a price of $19 per unit and 12,500 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	$	400,500	$	162,400	$	562,900
Direct labor	$	120,900	$	42,900		163,800
Manufacturing overhead						488,700
Cost of goods sold					$	1,215,400

The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $51,000 and $106,000 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 Overhead			Activity
Activity Cost Pool (and Activity Measure)				B300	T500	Total
Machining (machine-hours)	$	198,900		90,600	62,400	153,000
Setups (setup hours)		127,600		80	210	290
Product-sustaining (number of products)		101,200		1	1	2
Other (organization-sustaining costs)		61,000		NA	NA	NA
Total manufacturing overhead cost	$	488,700

Required:

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

2. Compute the product margins for B300 and T500 under the activity-based costing system.

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

Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your intermediate calculations to 2 decimal places and "Percentage" answers to 1 decimal place and and other answers to the nearest whole dollar amounts.)

	B300			T500			Total
		% of			% of
	Amount			Amount			Amount
Traditional Cost System
Direct materials	$400,500	71.1	%	$162,400	28.9	%	$562,900
Direct labor			%			%
Manufacturing overhead			%			%
Total cost assigned to products	$400,500			$162,400			$562,900
Selling and administrative
Total cost							$562,900
	B300			T500			Total
		% of			% of
	Amount	Total Amount		Amount	Total Amount		Amount
Activity-Based Costing System
Direct costs:
			%			%
			%			%
			%			%
Indirect costs:
			%			%
			%			%
			%			%
Total cost assigned to products	$0			$0			0
Costs not assigned to products:
Total cost							$0