Problem 7-17 Comparing Traditional and Activity-Based Product Margins (LO7-1, LO7-3, LO7-4, LO7-5] 50 Smoky Mountain Corporation makes two types of hiking bootsthe Xtreme and the Pathfinder. Data concerning these two product lines appear below: points Xtreme $ 121.00 $ 63.70 $ 8.80 1.1 DLHS 26,000 units Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production and sales Pathfinder $ 91.00 $ 56.00 $ 8.00 1.0 DLHS 73,000 units eBook Print The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: References Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,133,600 101,600 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): Activities and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) Other Total manufacturing overhead cost Estimated Overhead Cost $ 629,920 768,000 710,000 25,680 $ 2,133,600 Expected Activity Xtreme Pathfinder Total 28,600 73,000 101,600 260 220 480 2 NA NA NA 50 points Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. eBook 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Print Complete this question by entering your answers in the tabs below. References Required 1 Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.) Xtreme Pathfinder Total Product margin Required 1 Required 2 >