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 $ 2,100,000 1,600,000 Gross margin Selling and administrative expenses Net operating loss 500,000 550,000 $ (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 Direct materials Direct labor Manufacturing overhead Cost of goods sold B300 $ 436,300 $ 251,700 $ 200,000 $ 104,000 Total $ 688,000 304,000 608,000 $ 1,600,000 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 Overhead Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other (organization-sustaining costs) Total manufacturing overhead cost $ 213,500 157,500 B300 90,000 Activity T500 Total 62,500 152,500 75 120,000 1 300 1 375 2 117,000 NA NA NA $ 608,000 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. Answer is not complete. 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 $ 363,700 $ 136,300 500,000 < Required 1 Required 2 > 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. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 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 $ 496,200 $ 496,200 < Required 1 Required 3 > 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. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 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. B300 T500 % of % of Total Amount Total Amount Amount Amount Total Amount Traditional Cost System Total cost assigned to products $ 0 $ 0 $ 0