Hi-Tek Manufacturing, Incorporated, 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 Incorporated Income Statement Sales Cost of goods sold Gross margin $ 1,695,400 1,252,744 442,656 Selling and administrative expenses Net operating loss 620,000 $ (177,344) Hi-Tek produced and sold 60,200 units of B300 at a price of $20 per unit and 12,600 units of T500 at a price of $39 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: Direct materials Direct labor Manufacturing overhead Cost of goods sold 8300 $ 400,800 $ 162,700 $ 120,800 $ 42,200 7500 Total $ 563,500 163,000 526,244 $ 1,252,744 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $58,000 and $103,000 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. Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours). Product-sustaining (number of products) Manufacturing Overhead $ 204,484 160,160 101,000 8300 90,000 Activity 7500 62,600 74 1 290 1 Total 152,600 364 2 < Prev 3 of 3 Next > Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours): Product-sustaining (number of products) Manufacturing Overhead $ 204,484 160,160 101,000 Other (organization-sustaining costs) Total manufacturing overhead cost AUCIVACY B300 90,000 T500 62,600 Total 152,600 74 290 364 1 1 2 60,600 NA NA NA $ 526,244 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 11 Required 2 Required 3 Compute the product margins for the B300 and T500 under the company's traditional costing system. (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.) Product margin B300 T500 Total Brow Next