NPV Calculation

Written by:Abraham A.
Location:DCF Analysis

Finance.ThinkAndDone.com provides you online tool to perform net present value NPV calculation from series of cash flows and the discount rate aka WACC. NPV method is used to find the net present value of an investment or that of an annuity; in both instances cash flows are discounted at the discount rate for time period t where t ranges from 1 to n for an ordinary annuity and from 0 to n for an annuity due. An organization usually accepts a projoect that has highest positive net present value that maximizes the profits.

Location: DCF Analysis

NPV Calculation

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

Results

Discounted Cash Flow Stream
DCF1 = -100000/(1+0.04)0 -100000 x 1 -100000
DCF2 = 35000/(1+0.04)1 35000 x 0.96154 33653.85
DCF3 = 35000/(1+0.04)2 35000 x 0.92456 32359.47
DCF4 = 35000/(1+0.04)3 35000 x 0.889 31114.87
DCF5 = 35000/(1+0.04)4 35000 x 0.8548 29918.15
DCF6 = 35000/(1+0.04)5 35000 x 0.82193 28767.45
DCF7 = -10000/(1+0.04)6 -10000 x 0.79031 -7903.15
Net Present Value (Annuity Due) T= 0 to N-1 47910.64

Input Data

type in the discount rate:  %
type in net cash flows in the space below:



Check this if different discount rates are used for each cash flow:

Instructions

To perform net present value calculation with this online tool, you need to type in the series of net cash flows along with the discount rate. In case of a capital budgeting project, the discount rate is WACC yet for an annuity problem the discount rate is the interest rate at which the annuity payments are discounted.

  • At first, you have to type in the cash flows where each of the cash flow is separated by a space such as -100000 35000 35000 35000 35000 35000 -10000
  • You have to select the type of payments such as start of period payments for annuity due or end of period payments for ordinary annuity
  • You must specify a discount rate such as 5
  • Finally a click on CALCULATE button will display detailed step step workout for NPV calculation
Location: Financial Calculations