Required information 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 $11.27 million, and the equipment has a useful life of 10 years with a residual value of $1,170,000. The company will use straight- line depreciation. Beacon could expect a production increase of 49,000 units per year and a reduction of 20 percent in the labor cost per unit. Current (no automation) 84,000 units Per Unit Total $ 97 $ ? Proposed (automation) 133,000 units Per Unit Total S 97 S ? $ 19 $ 19 Production and sales volume Sales revenue Variable costs Direct materials Direct labor Variable manufacturing overhead Total variable manufacturing costs Contribution margin Fixed manufacturing costs Net operating income 10 10 49 $ 48 $ 1,160,000 $2,280,000 PA11-2 Part 4 4. Using a discount rate of 14 percent, calculate the net present value (NPV) of the proposed Investment. (Future Value of $1. Present Value of $1, Future 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 5. Recalculate the NPV using a 9 percent discount rate. (Future Value of $1. Present Value of $1. Future 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