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	$	1,697,300
Cost of goods sold		1,243,560
Gross margin		453,740
Selling and administrative expenses		590,000
Net operating loss	$	(136,260)

Hi-Tek produced and sold 60,100 units of B300 at a price of $20 per unit and 12,700 units of T500 at a price of $39 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	$	400,300			$	162,100			$	562,400
Direct labor	$	120,700			$	42,600				163,300
Manufacturing overhead										517,860
Cost of goods sold									$	1,243,560

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 $109,000 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)	$	205,740				90,000			62,400			152,400
Setups (setup hours)		151,620				71			290			361
Product-sustaining (number of products)		100,400				1			1			2
Other (organization-sustaining costs)		60,100				NA			NA			NA
Total manufacturing overhead cost	$	517,860