! 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 $6.97 million, and the equipment has a useful life of 5 years with a residual value of $1,020,000. The company will use straight- line depreciation. Beacon could expect a production increase of 39,000 units per year and a reduction of 20 percent in the labor cost per unit. Production and sales volume Sales revenue Variable costs Current (no automation) 86,000 units Proposed (automation) 125,000 units Per Unit $ 98 Total $ ? Per Unit Total $ 98 $ ? $ 15 25 ? 12 52 $ 46 226 12 ? ? $ 51 1,110,000 ? ? 2,220,000 ? Direct materials Direct labor Variable manufacturing overhead Total variable manufacturing costs Contribution margin Fixed manufacturing costs $ 15 Net operating income PA11-2 Part 5 Required: 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.) Note: 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