Problem 7-16 (Algo) Comparing Traditional and Activity-Based Product Margins [LO7-1, L07-3, L07-4. LO7-5] Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-she 3300 and the T500. An absorption costing income statement for the most recent period is shown Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Grossmarin Selling and adinistrative expenses Not operating loss $ 1.7.100 1,245,348 58,00 (59,248) Hi-Tex produced and sold 60,100 units of 3300 st a price of $21 per unit and 2.600 units of T500 st a price of $40 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhese rate and direct labor dollars as the location base. Additional Information relating to the company's two product lines is shown below B3 T500 Total Direct materials $ 480,58 $ 162,700$ 563.200 Direct labor $ 128,480 $ 42,500 152.000 Manufacturing overhead 519,48 Cost of goods sold $ 1,245, MA The company has crested an actity-based costing system to evaluate the profitability of its products. Hi-Teks ABC implementation team concluded that $54.000 and $109,000 of the company's advertising expenses could be directly traced to 300 and 7500. respectively. The remainder of the selling and sclministrative expenses wes organization-sustaining in nature. The ABC team also distributed the company's manufacturing overhead to four activities as shown below. Manufacturing Activity Activity Cost Pool (and Activity Measure) Overhead 1500 Total Machining (machine-hours) $ 212,948 98,962 62,380 153,200 Setups (setup hours) 145,200 73 363 Product-Sustaining (ber of products) 180,200 1 1 Other (organization-sustaining costs) 6, NA Total sufacturing overhead cost $ 519,248 2 NA Required: 1. Compute the product margins for the 3300 and T500 under the company's traditional costing system. 2 Compute the product margins for 300 snd T500 under the activity-based costing system 3. Prepares quantitative comparison of the traditions and act-based cost assignments Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your intermediate calculations to 2 decimal places and Percentage' answers to 1 decimal place and and other answers to the nearest whole dollar amounts.) B100 T500 Total of Amount Amount Amount Traditional Cost ystem 9 96 9 95 Total cost assigned to products 8 0 0 $ 0 Total cost BIOD Total of Total Amount T500 of Amount Total Amount Amount Amount ACM-Eased Cosing System Direct costs: 9 96 Indirect costs 90 95 $ 0 Total cost assigned to products Cos's not assigned to products Total GOS! $ 0