PA11-2 (Algo) Making Automation Decision (LO 11-1, 11-2, 11-3, 11-5] (The following information applies to the questions displayed below] Beacon Company is considering automating its production facility. The initial investment in automation would be $10.08 million, and the equipment has a useful life of 8 years with a residual value of $1,040,000. The company will use straight- line depreciation. Beacon could expect a production increase of 35,000 units per year and a reduction of 20 percent in the labor cost per unit. Proposed (automation) 116,000 units Current (no automation) $1,000 units Per Per Production and sales volume Unit Total Unit Total Sales revenue 5:95 $7 $ 95 $7 Variable costs Direct materials $17 Direct labor 20 Variable manufacturing overhead 12 Total variable manufacturing 49 costs Contribution margin $ 46 7 $ 50 7 Fixed manufacturing costs Net operating income $1,210,000 7 $ 2,270,000 7 PA11-2 Part 5 5. Recalculate the NPV using a 9 percent discount rate. (Future Value of $1. Present Value of $1. Euture Value Annuity of $1. Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Negative amount should be indicated by a minus sign. Enter the answer in whole dollars.) Net present value