Precision Manufacturing Inc. (PMI) makes two types of industrial component partsthe EX300 and the TX500. An absorption costing income statement for the most recent period is shown below: Precision Manufacturing Inc. Income Statement Sales $ 1,718,000 Cost of goods sold 1,233,054 Gross margin 484,946 Selling and administrative expenses 550,000 Net operating loss $ (65,054) PMI produced and sold 60,500 units of EX300 at a price of $20 per unit and 12,700 units of TX500 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: EX300 TX500 Total Direct materials $ 400,700 $ 162,200 $ 562,900 Direct labor $ 120,500 $ 42,400 162,900 Manufacturing overhead 507,254 Cost of goods sold $ 1,233,054 The company has created an activity-based costing system to evaluate the profitability of its products. PMIs ABC implementation team concluded that $54,000 and $106,000 of the companys advertising expenses could be directly traced to EX300 and TX500, 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: Manufacturing Activity Activity Cost Pool (and Activity Measure) Overhead EX300 TX500 Total Machining (machine-hours) $ 211,554 90,300 63,000 153,300 Setups (setup hours) 133,600 74 260 334 Product-sustaining (number of products) 101,800 1 1 2 Other (organization-sustaining costs) 60,300 NA NA NA Total manufacturing overhead cost $ 507,254 Required 1. Compute the product margins for the EX300 and TX500 under the companys traditional costing system. (Loss amounts should be indicated with a minus sign. Do not round intermediate calculations. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.) EX300 TX500 Total Product margin $ $ $ 2. Compute the product margins for EX300 and TX500 under the activity-based costing system. (Loss amounts should be indicated with a minus sign. Do not round intermediate calculations. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.) EX300 TX500 Total Product margin $ $ $ 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your percentage answers to one decimal place and other answers to the nearest dollar amount. Omit the "$" & "%" signs in your response.) EX300 TX500 Total Amount % of Total Amount Amount % of Total Amount Amount Traditional Cost System $ % $ % $ % % % % Total cost assigned to products $ $ Total cost $ Activity-Based Costing System Direct costs: $ % $ % $ % % % % Indirect costs: % % % % % % Total cost assigned to products $ $ Costs not assigned to products: Total cost $