Learn to calculate present value (PV) in Excel using rate and period inputs for better investment comparisons and informed financial decisions.

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return. Net present value tells us ...

Net present value (NPV) represents the difference between the present value of cash inflows and outflows over a set time period. Knowing how to calculate net present value can be useful when choosing ...

David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, corporate and individual tax planning and preparation, and investing and retirement planning.

Small business owners frequently make decisions about how to invest money to increase profitability. Part of being a good business manager is the ability to analyze the income potential of long-term ...

Calculate the present value of each year's cash flow by dividing by (1 + discount rate)^number of years. Sum all present values to find the total value of projected cash flows, which in this example ...

The net present value (NPV) method can be a very good way to analyze the profitability of an investment in a company, or a new project within a company. But like many methods in finance, it is not the ...

Capital budgeting decisions are among the most important decisions a business owner or manager will ever make. Which assets to invest in, which products to develop, which markets to enter, whether to ...

Net present value and the profitability index are helpful tools that allow investors and companies make decisions about where to allocate their money for the best return. Net present value tells us ...

Credit: By discounting every future $3,000 cash flow back at a rate of 10%, and subtracting the initial cash outlay of $15,000, we arrive at a net present value of $3,433.70 for this project. Under ...