(NPV) Fullerton Iron Works is considering the installation of an $800,000 au¬ tomated product handling system that would generate the following labor cost savings over its 10-year life:

The system will have no salvage at the end of its 10-year life, and the com¬ pany uses a discount rate of 12 percent. What is the pre-tax net present value of this potential investment? LO.1 

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Annual Labor Years Cost Savings 1-2 $140,000 3-5 170,000 6-8 144,400 9-10 130,000