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	$	1,703,300
Cost of goods sold		1,235,730
Gross margin		467,570
Selling and administrative expenses		550,000
Net operating loss	$	(82,430)

Hi-Tek produced and sold 60,400 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	$	400,600	$	162,400	$	563,000
Direct labor	$	120,400	$	42,900		163,300
Manufacturing overhead						509,430
Cost of goods sold					$	1,235,730

The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $56,000 and $104,000 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)	$	199,290	90,800	62,500	153,300
Setups (setup hours)		147,840	72	280	352
Product-sustaining (number of products)		102,000	1	1	2
Other (organization-sustaining costs)		60,300	NA	NA	NA
Total manufacturing overhead cost	$	509,430
1. Compute the product margins for the B300 and T500 under the companys traditional costing system. (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole dollars.) 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.) 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) and other answers to nearest whole dollar amounts.)

Traditional Cost System Direct materials Direct labor Manufacturing overhead Total cost assigned to products Selling and administrative Total cost Activity-Based Costing System Direct costs: Direct labor Direct materials Indirect costs: Machining Setups Other Total cost assigned to products Costs not assigned to products: Selling and administrative Total T500 B300 of of Amount Total Amount Amount Total Amount Amount 0 B300 T500 Total of of Amount Total Amount Total Amount Amount Amount 0 S