MIRR calculation

Written by:Abraham A.
Location:DCF Analysis

Finance.ThinkAndDone.com provides you an online tool to perform modified internal rate of return MIRR calculation from series of future cash flows, reinvestment rate and finance rate. MIRR method finds modified internal rate of return by calculating geometric average of net future value of benefits and net present value of costs. As it may not be possible to calculate IRR in many instances thus a need to find a rate of return that is always calculable is satisfied with advent of an adjusted or modified internal rate of return. One has to ensure that at least one of the cash flows is positive and at least one of the cash flows is negative. This online MIRR calculation tools shows you detailed step by step workout for finding MIRR.

Location: DCF Analysis

MIRR Calculation

Developed by:Emma A.
Location:Financial Calculations
type in the authorization code in the box located below:

Results

Compounded Net Cash Flows at 5%

CCF1 = 35000 x (1+5%)5 = 35000 x 1.27628 = 44669.85
CCF2 = 35000 x (1+5%)4 = 35000 x 1.21551 = 42542.72
CCF3 = 35000 x (1+5%)3 = 35000 x 1.15763 = 40516.88
CCF4 = 35000 x (1+5%)2 = 35000 x 1.1025 = 38587.5
CCF5 = 35000 x (1+5%)1 = 35000 x 1.05 = 36750
FV = 203066.95

Discounted Net Cash Flows at 5%

DCF0 = -100000 / (1+5%)0 = -100000 x 1 = -100000
DCF6 = -10000 / (1+5%)6 = -10000 x 1.3401 = -7462.15
PV = -107462.15

MIRR Formula

MIRR = (-FV/PV)1/n-1-1
MIRR = (-203066.95/-107462.15)1/6-1
MIRR = 1.11189545099 - 1
MIRR = 0.111895450989
MIRR = 11.19%

Input Data

Please enter the reinvestment rate :  %
Please enter the finance rate:  %
Please enter the net cash flows in the space below:

Instructions

To perform modified internal rate of retrun calculation with this online tool, you need to type in the net cash flows, the reinvestment rate and the finance rate. Follow the instructions listed below on using this online tool to find MIRR

  • The cash flows have to be entered as a series of numbers each separated by a space such as -100000 35000 35000 35000 35000 35000 -10000
  • The reinvestment rate has to entered in as 5 for example
  • The finance rate has to be typed in as 5 for example
  • Last, a click on the CALCULATE button will display detailed MIRR calcualtions