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Check my work Problem 7-17 (Algo) Comparing Traditional and Activity-Based Product Margins [LO7-1, L07-3, LO7-4, LO7-5] Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfinder. Data concerning these two product lines appear below. Xtreme Pathfinder $ 83.00 Selling price per unit Direct materials per unit Direct labor per unit, $ 115.00 $65.10 $10.00 $ 50.00 $ 10.00 Direct labor-hours per unit Estimated annual production and sales 1.0 DLHS 29,000 units 1.0 DLHS 71,000 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 $ 1,800,000 100,000 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):