Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfindet. Data concerning these two product lines appear below, Xtreme Pathfinder Selling price per unit $ 121.00 $ 86.00 Direct materials per unit $ 65.30 $ 52.ee Direct labor per unit $ 13.50 $ 9.00 Direct labor-hours per unit 1.5 DLHS 1.6 DLHS Estimated annual production and sales 31,000 units 65,000 units 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 $ 2,230,000 Estimated total direct labor-hours 111,500 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): Estimated Expected Activity Activities and Activity Measures Overhead Cost Xtreme Pathfinder Total Supporting direct labor (direct labor-hours) $ 724, 750 46,500 65,000 111,500 Batch setups (setups) 975, 800 420 330 750 Product sustaining number of products) 470,000 Other 60,250 NA NA Total manufacturing overhead cost $ 2, 230,000 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity based cost assignments. 1 2 1 NA