If a project require Rs.17200 initial investment and its expected cash flow Rs.5100 continuously 05 year what will be its IRR?
If a project require Rs.22430 initial investment and its expected cash flow Rs.7500 continuously 05 year what will be its IRR?
If a project require Rs.1065000 initial investment and its expected cash flow Rs.350000 continuously 05 year what will be its IRR?
(17,200)
(22,430)
(1,065,000)
(1,000,000)
1st year
5,100
7,500
350,000
150,000
2nd year
5,100
7,500
350,000
150,000
3rd year
5,100
7,500
350,000
150,000
4th year
5,100
7,500
350,000
150,000
5th year
5,100
7,500
350,000
150,000
14.74%
20.00%
19.22%
150,000
15%
150,000
150,000
150,000
150,000
TIPS
8.14%
Ø Initial investment will be written with minus sigh for example (-17200)
Ø Cash flow will be written according to chronological order for example in first cell cash flow of first year will be written and respectively other years.
Ø If at last year 02 cash flow happen than it will be written in one cell for example if last year cash flow of 5th year is (5100 & 4500). It will be considered as 9600 in 5th year.
Ø After completing all the parameter. Click a cell and Insert the IRR function
Ø Write = Irr( drag all the cash flow in the bracket) press inter key for example =IRR(F10:F15)
Ø (F10:F15) ( F10 to F15 consist of initial investment & all cash flow chronological order
Ø If it demand guess give it to 0.1 otherwise leave it
Ø Result will be 15%, now you have split it in two decimal place for accuracy
How to calculate the IRR by help of MS Excel.xlsx