PROBI EM 7-24 Comparing Traditional and Nctivity Bastd Prodoct Mergins [ LO1, LG LO3, [S LO4, [S, LO5] H.Tek Masufacturing Inc, makes two types of industrial component parts-the B300 and the T So0. An absorption costing income statement for the most recent period is thown below: Hi.Tek produced and sold 70,000 units of 8300 at a price of $20 per unit and 17,500 units of T500 at a price of 540 per unit. The company's traditional cost ryatem allocates manufecturing overhead to products using a plantwide overhead rate and difect labour dollars as the allocation base Additional information relating to the compary's two product lines is shown below: The company has created an activitybased costins system to evatuate the prottability of its products. HS-Tek's ABC implementation team concluded that $50,000 and 5100,000 of the company's advertising expenses conld be directly traced to B300 asd T 500 , respectively. The remainder of the selling and administrative expenses were organizationsustaining in nature. The ABC team also distributed the company's manufacturing overthead to tour activities as shovin below, 1. Using [C Exhibit 7-14 as a gaide, compute the product margins for the B300 and T 500 under the company's traditional costing syztem. 2. Using C. Exhibit 7-12 as a gaide, compute the product margins for B300 and T 500 under the activitybased costing aystem. 3. Uaing [0] Exabit 7-15 as a gaide, prepare a quantitative comparison of the traditional and activity-based cost assignments. Explain why the traditional and activity-based cost assifnments differ