Refer to the Lopez Plastics Company illustration on pages 136 –140 and to Exhibit 4-7. Also see the table in the solution to the first Summary Problem for Your Review on page 140. Based on new information, management has adjusted the percentages that apply to the first stage of the ABC system as shown in the following table. Prepare a schedule that shows the gross margins for both products.

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Indirect Resource Percent of Resource Used in Processing activity Production support activity Plant and Machinery 90% 10% Engineers and CAD Equipment 30% 70%