Net Present Value Question

[ktbull]

I need to be able to determine what the net present value would be for a list
of months with varying dollar amounts (For example: Jan 120000, Feb 35000,
March 55000, etc). What would the values be worth today?

 

[David Billigmeier]

You didn't specify a rate so I'll assume 5%... You can do this in 2 ways,
first use NPV():

=NPV(0.05,120000,35000,55000)

Or you can choose to understand what the NPV() formula is doing by
calculating manually:

=120000/(1.05)+35000/(1.05^2)+55000/(1.05^3)

 

[ktbull]

Thank you for your response! Very helpful.

You didn't specify a rate so I'll assume 5%... You can do this in 2 ways,
first use NPV():

=NPV(0.05,120000,35000,55000)

Or you can choose to understand what the NPV() formula is doing by
calculating manually:

=120000/(1.05)+35000/(1.05^2)+55000/(1.05^3)

 

[wlfoote]

You didn't specify a rate so I'll assume 5%... You can do this in 2 ways,
first use NPV():

=NPV(0.05,120000,35000,55000)

Or you can choose to understand what the NPV() formula is doing by
calculating manually:

=120000/(1.05)+35000/(1.05^2)+55000/(1.05^3)