Hi-Tek Manufacturing, Incorporated, makes two industrial component partsB300 and T500. An absorption costing income statement for the most recent period is shown below:

Hi-Tek Manufacturing, Incorporated
Income Statement
Sales	$ 1,691,500
Cost of goods sold	1,243,877
Gross margin	447,623
Selling and administrative expenses	580,000
Net operating loss	$ (132,377)

Hi-Tek produced and sold 60,200 units of B300 at a price of $20 per unit and 12,500 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	$ 400,800	$ 162,800	$ 563,600
Direct labor	$ 120,900	$ 42,600	163,500
Manufacturing overhead			516,777
Cost of goods sold			$ 1,243,877

The company created an activity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $60,000 and $110,000 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:

Activity Cost Pool (and Activity Measure)	Manufacturing Overhead	Activity
B300	T500	Total
Machining (machine-hours)	$ 209,747	90,500	62,600	153,100
Setups (setup hours)	144,730	73	280	353
Product-sustaining (number of products)	101,800	1	1	2
Other (organization-sustaining costs)	60,500	NA	NA	NA
Total manufacturing overhead cost	$ 516,777

Required:

1. Compute the product margins for B300 and T500 under the companys traditional costing system.Compute the product margins for B300 and T500 under the companys traditional costing system. Note: Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.

	B300	T500	Total
Product margin			$0

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

2. Compute the product margins for B300 and T500 under the activity-based costing system. Note: Negative product margins should be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.

	B300	T500	Total
Product margin			$0

3.

Prepare a quantitative comparison of the traditional and activity-based cost assignments. Note: 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 Amount
	% of		% of
Amount	Total Amount	Amount	Total Amount
Traditional Cost System
Total cost assigned to products	$0		$0		$0
Total cost					$0
	B300	T500	Total Amount
	% of		% of
Amount	Total Amount	Amount	Total 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