Smoky Mountain Corporation makes two types of hiking boots$-$the Xtreme and the Pathfinder. Data concerning these two productSmoky Mountain Corporation makes two types of hiking boots$-$the Xtreme and the Pathfinder. Data concerning these two product

lines appear below:

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.

Estimated total manufacturing overhead

Estimated total direct labor$-$hours

$1,980,000$

$120,000DLHs$

Required:

Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system.

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$)$:

Compute the product margins for the Xtreme and the Pathfinder products under the activity$-$based costing system.

Prepare a quantitative comparison of the traditional and activity$-$based cost assignments.

Complete this question by entering your answers in the tabs below.

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.$)$

lines appear below:

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:

Estimated total manufacturing overhead

Estimated total direct labor$-$hours

$$1,980,000$

$120,000$ DLHs

Required:

Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system.

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$)$:

Compute the product margins for the Xtreme and the Pathfinder products under the activity$-$based costing system.

Prepare a quantitative comparison of the traditional and activity$-$based cost assignments.