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 $1,637,200 Cost of goods sold 1,253,308 Gross margin 383,892 Selling and administrative expenses 600,000 Net operating loss $ (216,108) Hi-Tek produced and sold 60,100 units of B300 at a price of $19 per unit and 12,700 units de 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: 3300 T500 Total Direct materials $ 400,400 $ 162,700 $ 563, 100 Direct labor $ 120,600 $ 42,600 163,200 Manufacturing overhead 527,008 Cont of goods sold $1,253,308 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 $105,000 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: Manufacturing Activity Activity Cout Pool (and Activity Measure) Overhead 3300 T500 Total Machining machine-hours) $ 207,808 90,600 62,200 152,800 Setups (setup hours) 157,500 300 375 Product-sustaining number of products) 101,200 1 Other (organization-sustaining coats) 60.500 Total manufacturing overhead cost $ 527,008 75 1 NA 2 RA NA $ 120,600 $ 42,600 Direct labor Manufacturing overhead Cost of goods sold 163,200 527,008 $ 1,253,308 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's A team concluded that $56,000 and $105,000 of the company's advertising expenses could be directly traced to E respectively. The remainder of the selling and administrative expenses was organization-sustaining in nature. Th 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 $ 207,808 157,500 101,200 60,500 $ 527,008 B300 90,600 75 1 NA Activity T500 62,200 300 1 NA Total 152,800 375 2 NA 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 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 1500 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 Raq Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 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 OK Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your intermediate calculations to 2 decin places and "Percentage" answers to 1 decimal place and and other answers to the nearest whole dollar amounts.) B300 T500 % of % of Total Amount Amount Amount Traditional Cost System + Total cost assigned to products Total cost B300 T500 Total Amount % of Total Amount Amount % of Total Amount Amount Activity-Based Costing System Direct costs: Total cost assigned to products Total cost B300 T500 Total Amount % of Total Amount % of Total Amount Amount Amount Activity-Based Costing System Direct costs: Indirect costs: Total cost assigned to products Costs not assigned to products: Total cost