NPV Help
spurschic1@yahoo.com
Registered Posts: 94 Regular contributor ⭐
Hi,
I am doing a test and have the following question:
Calculate the NPV of the project at company cost of capital 15%. I have the details of the cost of the equipment, estimated savings for 4 years and discounted cash flow for 6 years.
Any idea how I work out the NPV? I've been through text book so many times now I'm lost!
Thanks! :001_smile:
I am doing a test and have the following question:
Calculate the NPV of the project at company cost of capital 15%. I have the details of the cost of the equipment, estimated savings for 4 years and discounted cash flow for 6 years.
Any idea how I work out the NPV? I've been through text book so many times now I'm lost!
Thanks! :001_smile:
0
Comments
-
You query does not give full details to be able to demonstrate how to work out NPV.
Normally NPV is work out on any additional cash inflow generated as a result of investment.
However, I have assumed certain figures and worked on the net savings figure. With my assumed figures I am getting a negative NPV of £20,000.
Look at my calculations in the attached file, and I hope this helps you to understand NPV
.Attachment not found.0
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