! Required information [The following information applies to the questions displayed below.] Beacon Company is considering automating its production facility. The initial investment in automation would be $11.49 million, and the equipment has a useful life of 10 years with a residual value of $1,190,000. 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. Current (no automation) 85,000 units Proposed (automation) 120,000 units Production and sales volume Per Unit Per Total Unit Total Sales revenue $ 98 $ ? $ 98 $ ? Variable costs Direct materials $ 18 $ 18 Direct labor 30 Variable manufacturing overhead 12 Total variable manufacturing costs 60 Contribution margin $ 38 ? $ 44 Fixed manufacturing costs $ 1,070,000 Net operating income ? ? ? $ 2,300,000