Professional Documents
Culture Documents
Cap Bud Calc
Cap Bud Calc
Year CF
0 -350000 NPV vs. IRR
1 80000
2 80000 Year
3 80000 0
4 80000 1
5 120000 2
6 120000 3
7 120000
8 117520 NPV at 10%
IRR
NPV at 12% 123621
NPV at 20% 6333
NPV at 21% -5088
Discounted Payback:
Net sales
Less: COGS
Less: Admn. & General Expenses
Less: Selling & Distribution Expenses
Less: Depreciation
= EBIT
Less: Income Tax
= PAT
Add back: Depreciation
= Operating Cash Flows
Less: Increase in working capital
Add: Recovery of working capital in Nth year
Add: Salvage in the Nth year
= CASH FLOW AFTER TAX
Project A Project B
-10000 -10000
2000 10000
4000 3000
12000 3000
4140 3824
27% 38%