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Calculating IRR - Evalue

Our app will help you calculate managerial accounting indexes for use as evaluation standards when making capital investments

Our app will help you calculate managerial accounting indexes for use as evaluation standards when making capital investments

Calculating IRR - Evalue

by Masaru Kondo
Calculating IRR - Evalue
Calculating IRR - Evalue
Calculating IRR - Evalue

What is it about?

Our app will help you calculate managerial accounting indexes for use as evaluation standards when making capital investments.

Calculating IRR - Evalue

App Details

Version
1.06
Rating
NA
Size
17Mb
Genre
Business Finance
Last updated
July 6, 2016
Release date
July 31, 2015
More info

App Store Description

Our app will help you calculate managerial accounting indexes for use as evaluation standards when making capital investments.

When should you use it?
Calculating net present value (NPV) is an excellent tool for dividing funds into multiple projects and making decisions based on total investment amounts.
Calculating internal rate of return (IRR) is helpful for when investment projects are fluctuating independently.
Each valuation method has both strengths and weaknesses.

Example
You receive a bank loan of $10,000 at an interest rate of 5%. You invest that money, yielding the following returns:
$5,000 in the 1st year
$3,000 in the 2nd year
$3,000 in the 3rd year
$1,000 in the 4th year
The NPV of this investment plan is 17.65.
This indicates that investing the current $10,000 will result in a value of $11,765.
The IRR is the interest rate at which the profit on the original $10,000 in this plan, even through the 4th year, will be $0.
The IRR in this case is 0.097797… meaning, if your interest rate is approximately 9%, you will be guaranteed to at least break even.
Your recovery period indicates how many years it will take to recover your initial investment.

Points to consider carefully
This app displays net present value (NPV) and internal rate of return (IRR) as rounded down to the nearest hundredth. In the above example, for instance, 0.097792 would instead be shown as 0.09.
IRR is calculated using Newton’s method.

Disclaimer:
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