Hi-Tek Manufacturing, Incorporated, makes two types of industrial component parts-the 8300 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 Selling and administrative expenses Net operating loss $ 1,705,200 1,223,924 481,276 560,000 $ (78,724) Hi-Tek produced and sold 60,300 units of 8300 at a price of $20 per unit and 12,800 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 Cost of goods sold Manufacturing overhead 8300 $ 400,100 $ 120,000 7500 $ 162,400 $ 42,300 Total $562,500 162,300 499,124 $ 1,223,924 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $53,000 and $107,000 of the company's advertising expenses could be directly traced to 8300 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). Other (organization-sustaining costs) Total manufacturing overhead cost Manufacturing Overhead $209,884 Activity 8300 90,600 1500 Tota 62,600 153,200 128,040 71 220 100, 400 60,800 1 1 291 2 NA NA NA $499,124 Required: 1 Compute the product margins for the B300 and T500 under the company's traditional costing system. 2. Compute the product margins for 8300 and T500 under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Required 1 Required 2 Required 3 Compute the product margins for the B300 and T500 under the company's traditional costing system. (Round your interm calculations to 2 decimal places and final answers to the nearest whole dollar amount.) Product margin B300 T500 Total 0 Required 1 Required 2 Required 3 Compute the product margins for B300 and T500 under the activity-based costing system. (Negative product margins Indicated by a minus sign. Round your intermediate calculations to 2 decimal places.) Product margin B300 T500 Total Required 11 Required 2 Required 3 Prepare a quantitative comparison of the traditional and activity-based cost assignments. (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.) Traditional Cost System Total cost assigned to products $ Total cost Amount 8300 % of Amount T500 % of Total Amount $ 0 $ 0 $ 0 8300 T500 % of % of Total Amount Amount Total Amount Amount Total Amount Activity-Based Costing System Direct costs: Indirect costs + Total cost assigned to products Costs not assigned to products $ 0 Total cost $ 0 $ 0