Hi-Tek Manufacturing, Incorporated, makes two types of industrial component partsthe B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Incorporated Income Statement Sales $ 1,649,500 Cost of goods sold 1,223,884 Gross margin 425,616 Selling and administrative expenses 590,000 Net operating loss $ (164,384) Hi-Tek produced and sold 60,500 units of B300 at a price of $19 per unit and 12,500 units of T500 at a price of $40 per unit. The companys 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 companys two product lines is shown below: B300 T500 To

Direct materials	$ 400,100	$ 162,200	$ 562,300
Direct labor	$ 121,000	$ 42,200	163,200
Manufacturing overhead			498,384
Cost of goods sold			$ 1,223,884

The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $57,000 and $105,000 of the companys 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 companys manufacturing overhead to four activities as shown below:

Activity Cost Pool (and Activity Measure)	Manufacturing Overhead	Activity
B300	T500	Total
Machining (machine-hours)	$ 203,224	90,600	62,200	152,800
Setups (setup hours)	133,660	76	250	326
Product-sustaining (number of products)	100,800	1	1	2
Other (organization-sustaining costs)	60,700	NA	NA	NA
Total manufacturing overhead cost	$ 498,384

Required:

1. Compute the product margins for the B300 and T500 under the companys 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.

Compute the product margins for the B300 and T500 under the companys traditional costing system. (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.)

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.)