H-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 $ 1,693,500 Cost of goods sold 1.225,550 Groes margin 467,950 selling and administrative expenses 630,000 Het operating 100 $ (162,050) Hi-Tek produced and sold 60,300 units of B300 at a price of $20 per unit and 12,500 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: BJ00 $ 400,900 $ 120,900 9500 $ 162,300 $ 42,600 Direct materials Direct labor Manufacturing overhead Cost of goods sold Total $ 563,200 163,500 490,850 $1,225,550 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 $102,000 of the company's advertising expenses could be directly traced to 1300 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 Control and notivy Horses Machining machine-hours) Setups (setup bours) Product-sustaining (nunber of products) other organizationsustaining costs) Total manufacturing overhead cost Manufacturing overhead $198.250 139,500 100,200 60.900 $ 498,650 2300 90,400 80 1 BA Activity T500 62,100 230 1 NA Total 152.500 310 2 NA Required: 1. Compute the product margins for the 8300 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. Saved ter 7 ine company has created an activity-based costing system to evaluate the profitability of its products. Hi-lek's ABC implementation team concluded that $53,000 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: 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 $ 198,250 139,500 100,200 60,900 $ 498,850 B300 90,400 80 1 NA Activity T500 62,100 230 1 NA Total 152,500 310 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.) 3300 T500 Total Product margin Required 2 > arlon Home - XCEL Sion Saved 1 - Chapter 7 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-lek's ABC implementation team concluded that $53,000 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 nativity Activity cont Pool (and Activity Measure) Overhead 3300 1500 Total Machining (machine-hours) $ 198,250 90,400 62, 100 152,500 Setups (setup hours) 139,500 80 230 310 Product-sustaining (number of products) 100,200 1 1 2 Other (organization-sustaining costs) 60.900 NA NA NA Total manufacturing overhead cost $ 498,850 Required: 1. Compute the product margins for the 1300 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. 00:48:27 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 places and Percentage" answers to 1 decimal place and and other answers to the nearest whole dollar amounts.) B300 T500 Total Amount % of % of Amount Amount Traditional Cost System 00:48:15 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