Smoky Mountain Corporation makes two types of hiking boots-Xtreme and the Pathfinder. Data concerning these two product lines appear below: Xtreme Pathfinder $ 91.00 $ 56.00 $ 8.00 $ 121.00 $ 63.70 2$ Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production and 8.80 1.1 DLHS 1.0 DLHS sales 26,000 units 73,000 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: $2,133,600 Estimated total manufacturing overhead Estimated total direct labor-hours 101,600 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. (Do not round your intermediate calculations.) Answer is complete but not entirely correct. Pathfinder Xtreme Total Product margin $ 660,4000 $ 483,000X $ 1,143,400 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 Overhead Activities and Activity Measures Supporting direct labor (direct labor- hours) Cost Xtreme Pathfinder Total 629,920 2$ 768,000 28,600 73,000 101,600 Batch setups (setups) 260 220 480 Product sustaining (number of products) Other 710,000 25,680 2 NA NA NA 2,133,600 Total manufacturing overhead cost Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. (Negative product margins should be indicated with a minus sign. Round your intermediate calculations to 2 decimal places.) Answer is complete and correct. Xtreme Pathfinder Total Product $ 312,680 $ 811,400 $ 1,124,080 margin 3. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Do not round intermediate calculations. Round your "Percentage" answer to 1 decimal place. (i.e. .1234 should be entered as 12.3)) X Answer is complete but not entirely correct. Pathfinder Xtreme Total % of % of Total Amount Total Amount Amount Amount Amount Traditional Cost System V$ 1,656,200 66.6%X $ 4,088,000- 65.9%X $ 5,744,200 Direct materials 584,000 228,800 9.2%X 9.4%X 812,800 Direct labor 24.2%X 1,533,000 600,600 24.7%X Manufacturing overhead 2,133,600 Total cost assigned to products $ 2,485,600 $ 6,205,000 8,690,600 Answer is complete but not entirely correct. Xtreme Pathfinder Total % of % of Total Total Amount Amount Amount Amount Amount Activity-Based Costing System Direct costs: V$ 1,656,200 58.5%X $ 4,088,000 70.1%X $ 5,744,200 Direct materials 8.1%X 584,000 10.0%X 228,800V Direct labor 812,800 Indirect costs: 452,600 7.8%X 6.3%X 177,320 629,920 Supporting direct labor Batch setups 416,000 14.7%X 6.0%X 352,000 768,000 Product sustaining 12.5%X 6.1%X 355,000 710,000 355,000 Total cost assigned to products Costs not assigned to products: $ 5,831,600 $ 2,833,320 $ 8,664,920 25,680 Other $ 8,690,600 Total cost