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Beacon Company is considering automating its production facility. The initial investment in automation would be...

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Accounting

Beacon Company is considering automating its production facility. The initial investment in automation would be $12.89 million, and the equipment has a useful life of 10 years with a residual value of $1,190,000. The company will use straightline depreciation. Beacon could expect a production increase of 38,000 units per year and a reduction of 20 percent in the labor cost per unit.
\table[[\table[[Production and sales volume],[Sales revenue]],\table[[Current (no automation)],[84,000 units]],\table[[Proposed (automation)],[122,000 units]]],[,Total,Per Unit,Total],[$91,$?,$91,],[Variable costs,,,,],[\table[[Direct materials],[Direct labor]],$ 18,,$ 18,],[\table[[Direct labor],[Variable manufacturing overhead]],\table[[20],[9]],,\table[[?]],],[Total variable manufacturing costs,47,,?,],[\table[[Contribution margin],[Fixed manufacturing costs]],$44,\table[[\table[[?
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