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 $ 1, 710,808 Cost of goods sold 1, 257, 650 Gross margin 452,350 Selling and administrative expenses 520, 908 Net operating loss $ (167,650) Hi-Tek produced and sold 60.100 units of B300 at a price of $20 per unit and 12.700 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. B380 T500 Total Direct materials $ 400, 780 3 162,030 3 562, 780 Direct labor $ 128, 508 $ 42, 608 163, 109 Manufacturing overhead 531, 850 Cost of goods sold $ 1, 257, 650 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $56,000 and $102,000 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 1500 Total Machining (machine-hours) $ 212,670 90,400 62,600 153,090 Setups (setup hours) 157, 080 280 357 Product-sustaining (number of products) 101, 480 Other (organization-sustaining costs) 68,780 NA Total manufacturing overhead cost $ 531, 850 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 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.) B300 T500 % of 9% of Total Amount Amount Amount Traditional Cost System Total cost assigned to products S O 0 S S Total cost B300 T500 6 of % of Total Amount Total Amount Total Amount Amount Amount Activity-Based Costing System Direct costs. Indirect costs: S S Total cost assigned to products Costs not assigned to products: Total cost