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Smoky Mountain Corporation makes two types of hiking boots--the Xtreme and the Pathfinder Data concerning these two product lives appear below Xtreme Pathfinder Selling price

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Smoky Mountain Corporation makes two types of hiking boots--the Xtreme and the Pathfinder Data concerning these two product lives appear below Xtreme Pathfinder Selling price per unit $ 121.00 $16.00 Direct materials per unit $ 65.30 $ 52.00 Direct labor per unit $ 13.50 $ 9.00 Direct Labor hours per unit 1.5 DLHS 1.0 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 Estimated total direct labor-hours $ 2,230,000 111,500 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) 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 $724,750 975, 470,000 60/250 2,230,000 Expected Activity Xtreme Pathfinder Total 46,500 65.000 111.500 420 330 750 1 1 2 NA NA NA Compute the product margins for the Xtreme and the Pathfinder products under the activity based costing system 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 Overhead Cost $724,750 975,000 470,000 68,250 $ 2, 230,000 Activities and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) Other Total manufacturing overhead cost Expected Activity Xtreme Pathfinder Total 46,500 65,000 111,500 420 750 1 1 2 NA NA NA 330 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. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the product margins for the Xtremne 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 Pathfindet Total $ 0 Product margin Required 2 > 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. (Round your intermediate calculations to 2 decimal places.) Xtreme Pathfinder Total Product margin 0 V 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) Xtreme Pathfinder % of Total Amount Amount % of Total Amount Total Amount Amount Traditional Cost System Direct materials Direct labor Manufacturing overhead Total cost assigned to products $ 0 $ 0 Xtreme Pathfinder Total Amount % of Total Amount W of Total Amount Amount Amount Activity-Based Costing System Direct costs Direct materials Direct labor Indired costs Supporting direct labor Batch setups Product sustaining Total cost assigned to products Costs assigned to products Other 5 $ 5 O Total cost Room2

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