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please help!! Required information PA11-2 (Static) Making Automation Decision [LO 11-1, 11-2, 11-3, 11-5] [The following information applies to the questions displayed below] Beacon Company
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Required information PA11-2 (Static) 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 $15 million, and the equipment has a useful life of 10 years with a residual value of $500,000. The company will use straightline depreciation. Beacon could expect a production increase of 40,000 units per year and a reduction of 20 percent in the labor cost per unit. Required: 2. Determine the project's accounting rate of return. Note: Round your answer to 2 decimal places. Required: 3. Determine the project's payback period. Note: Round your answer to 2 decimal places. Required: 4. Using a discount rate of 15 percent, calculate the net present value (NPV) of the proposed investment. (Future Value of S1. Present Volve of $1. Future Volue Annulty of \$1, Present Volue Annuity of (\$1) Note: Use appropriate factor(s) from the tables provided. Negative amount should be indicated by a minus sign. Enter the answer in whole dollars. Required: 5. Recalculate the NPV using a 10 percent discount rate. Future Volue of $1, Present Value of $1. Future Value Annuiry of $1. Prese Value Annuity of \$1.) Note: Use appropriate factor(s) from the tables provided. Enter the answer in whole dollars. TABLE 11.1A Future Value of $1 TABLE 11.2A Present Value of $1 TABL.E 11.3. Future Value of an Annuity of 51 TABLE 11.4 A Present Value of Annuity of $1 Required information PA11-2 (Static) 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 $15 million, and the equipment has a useful life of 10 years with a residual value of $500,000. The company will use straightline depreciation. Beacon could expect a production increase of 40,000 units per year and a reduction of 20 percent in the labor cost per unit. Required: 2. Determine the project's accounting rate of return. Note: Round your answer to 2 decimal places. Required: 3. Determine the project's payback period. Note: Round your answer to 2 decimal places. Required: 4. Using a discount rate of 15 percent, calculate the net present value (NPV) of the proposed investment. (Future Value of S1. Present Volve of $1. Future Volue Annulty of \$1, Present Volue Annuity of (\$1) Note: Use appropriate factor(s) from the tables provided. Negative amount should be indicated by a minus sign. Enter the answer in whole dollars. Required: 5. Recalculate the NPV using a 10 percent discount rate. Future Volue of $1, Present Value of $1. Future Value Annuiry of $1. Prese Value Annuity of \$1.) Note: Use appropriate factor(s) from the tables provided. Enter the answer in whole dollars. TABLE 11.1A Future Value of $1 TABLE 11.2A Present Value of $1 TABL.E 11.3. Future Value of an Annuity of 51 TABLE 11.4 A Present Value of Annuity of $1 Step by Step Solution
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