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 Incone Statement Sales $ 1,661,500 Cost of goods sold 1,216,646 Gross margin 444,854 Selling and administrative expenses 570,000 Net operating loss $ (125,146) Hi-Tek produced and sold 60,500 units of 8300 at a price of $19 per unit and 12,800 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 8300 T500 Total Direct materials $ 400, 400 $ 162,600 $ 563,000 Direct labor $ 121,000 $ 43,000 164,000 Manufacturing overhead 489.646 Cost of goods sold $1,216,646 Total 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 $101000 of the company's advertising expenses could be directly traced to 8300 and TSOO, 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 Manufacturing Activity Overhead 6300 T500 Machining (nachine-hours) $ 199,900 90,200 62,400 Setups (setup hours) 152,600 128,140 78 220 298 Product -sustaining number of products) 100,600 1 1 2 Other (organization-sustaining costs) 61,000 NA NA NA Total manufacturing overhead cost $ 419,646 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, Manufacturing Activity Activity Cost Pool (and Activity Measure) Overhead B300 T500 Total Machining (machine-hours) $ 199,906 90,200 62,400 152,600 Setups (setup hours) 128, 140 78 229 298 Product-sustaining (number of products) 100,600 1 1 2 Other (organization-sustaining costs) 61,000 NA NA NA Total manufacturing overhead cost $ 489,646 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 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.) B300 T500 Total Product margin $ 0 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 Compute the product margins for B300 and T500 under the activity-based costing system. (Negative product margins should be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.) B300 T500 Total Product margin 0 BUV TDUU % of % of Total Amount Amount Amount $ $ $ 400,400 121,000 162,600 43,000 Traditional Cost System Direct materials Direct labor Manufacturing overhead Total cost assigned to products Selling and administrative Total cost 563,000 164,000 489,646 1,216,646 S 521,400 $ 205,600 $ $ 1,216,646 B300 T500 Total Amount Amount % of Total Amount % of Total Amount Amount Activity-Based Costing System Direct costs Direct materials Direct labor Advertising expense Indirect costs: Machining Setups Product sustaining Total cost assigned to products Costs not assigned to products: Selling and administrative Other TH $ $