Quicksaw Inc. is a production company that is in the process of testing a strategic initiative aimed at increasing gross profit. The company's current sales revenue is $2,400,000. Currently, the company's gross pront is 35% of sales, but the company's target gross profit percentage is 40%. The company's current monthly cost of production is $1,560,000. Of this cost, 60% is for labor, 20% is for materials, and 20% is for overhead, The strategle initiative being tested at Quicksaw is a redesign of its production process that splits the process into two sequential procedures, The makeup of the costs of production for Procedure 1 is currently 50% direct labor, 45% direct materials, and 5% overhead, The makeup of the costs of production for Procedure 2 is currently 55% direct labor, 25\% direct materials, and 20% overhead, Company management estimates that Procedure 1 costs twice as much as Procedure 2. Required: 1. Determine what the cost of iabor, materials, and overhead for both Procedures 1 and 2 would need to be for the company to meet its target gross profit at the current level of sales. Cost maknun of Drncedure 1+ Cost makeup of Procedure 2: Direct Labor Direct Materials 2. The company's actual direct materials cost is $446,400 for Procedure 1. Determine the actual cost of direct labor, direct materials, and overhead for each procedure, and the total cost of production for each procedure. 3. The company is planning a CSA initiative to reuse some of the indirect materials used in production during Procedure 2. These indirect materials normally makeup 70\%s of the overhead cost for Procedure 2, but the CSR initiative would reduce the usage of indirect materials. Determine what the maximum new cost of these indirect materials couid be for Procedure 2 if this CSA initiative is expected to enable the company to meet its target gross profit percentage (holding all other costs constant). Maximum new cost of P2 overhead materials: 1 Quicksaw inci is a production company that is in the process of testing a strategic initiative aimed at increasing gross profit. The company's current sales revenue is $2,400,000. Currently, the company's gross profit is 35% of sales, but the company's target gross profit percentage is 40%. The company's current monthly cost of. production is $1,560,000. Of this cost, 60% is for labor, 20% is for materials, and 20% is for overhead. The strategic initiative being tested at Quicksaw is a redesign of its production process that splits the process into two sequential procedures. The makeup of the costs of production for Procedure 1 is currently 50% direct iabor, 45% direct materials, and 5% overhead. The makeup of the costs of production for Procedure 2 is currently 55% direct labor, 25% direct materials, and 20% overhead. Company management estimates that Procedure 1 costs twice as much as Procedure 2. Required: 1. Determine what the cost of laboc, materials, and overhead for both Procedures 1 and 2 would need to be for the company to meet its target gross profit at the current level of sales. Cost makeup of Procedure 2: Drect Labor Direct Materials Overhead 2. The company's actual direct materials cost is $446,400 for Procedure 1. Determine the actual cost of direct laboc, direct materials, and overhead for each procedure, and the total cost of production for each procedure. 3. The company is planning a CSR. initiative to reuse some of the indirect materials used in production during Procedure 2. These indirect materials normaliy makeup.70\% of the overhead cost for Procedure 2, but the CSR initiotive would reduce the usage of indirect materials. Determine what the maximum new cost of these indirect materials could be for Procedure 2 if this CSA initative is expected to enabie the company to meet its target gross profit percentage (holding all other costs constant). Maximum new cost of Pz overhead materials: 1 x