Hi-Tek Manufacturing, Incorporated, makes two types of industrial component parts--the B300 and the T500. An absorption costing income statement for the most recent period is shown Hi-Tek Manufacturing Incorporated Income Statement Sales $ 1,714,000 Cost of goods sold 1,244,650 Gross margin 469,350 Selling and administrative expenses 610,000 Net operating loss $ (149,650) Hi-Tek produced and sold 60,300 units of B300 at a price of $20 per unit and 12700 units of T500 at a price of $40 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollors as the allocation base Additional information relating to the company's two product lines is shown below: B300 $ 400,700 $ 120, 100 T500 $ 162,400 5.42,900 Direct materials Direct labor Manufacturing overhead Cost of goods sold Total $ 563, 100 163,000 518.550 $ 1,244,650 The company has created an activity-based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $59,000 and $106,000 of the company's advertising expenses could be directly traced to B300 and T500, respectively. The remainder of the selling and administrative expenses was organization-sustaining in nature. The ABC team also distributed the company's manufacturing overhead to four activities as shown below. The company has created an activity based costing system to evaluate the profitability of its products. Hi-Tek's ABC implementation team concluded that $59,000 and $106,000 of the company's advertising expenses could be directly traced to B300 and T500, respectively. The remainder of the selling and administrative expenses was organization-sustaining in nature. The ABC team also distributed the company's manufacturing overhead to four activities as shown below Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-Sustaining number of products) Other (organization-sustaining costs) Total manufacturing overhead cost Manufacturing Overhead $ 211,830 145, 320 101,400 60, eee $ 518,550 B300 90, 500 76 1 NA Activity T500 63,000 270 1 NA Total 153,500 346 2 NA Required: 1 Compute the product margins for the B300 and T500 under the company's traditional costing system. 2 Compute the product margins for B300 and 1500 under the activity based costing system 3. Prepare a quantitative comparison of the traditional and activity based cost assignments Required 1 Required 2 Required 3 Compute the product margins for the B300 and T500 under the company's traditional costing system. (Hund your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.) B300 T500 Total Product margin Compute the product margins for B300 and 1500 under the activity based costing system. (Negative product margins should be indicated by a minus sign. Round your intermediate calculations to 2 decimal places.) B300 T500 Total Product margin Required 1 Required 2 Required 3 Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your intermediate calculations to 2 decim places and Percentage" answers to 1 decimal place and and other answers to the nearest whole dollar amounts.) B300 T500 % of % of Total Amount Amount Amount Traditional Cost System Total cost assigned to products Total cost B300 T500 Total Amount % of Total Amount Amount % of Total Amount Amount Activity-Based Costing System Direct costs indirect costs Total cost assigned to products Costs not assigned to products