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: Hi-Tek Manufacturing Inc. Income Statement Sales $ 2,100,000 Coot 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 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: 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 3300 5 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $50,000 and $100,000 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 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 Product-sustaining (number of products 120,000 Other (organization-suntaining costs) 117.000 Total manufacturing overhead cost $ 600,000 300 1 NA 1 NA 375 2 NA Required: 1. Compute the product margins for the B300 and T500 under the company's 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. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the product margins for the B300 and T500 under the company's traditional costing system. B300 T500 Total Product margin Fequired Required 2 >