Finance & Investment · Returns
IRR & NPV Calculator
Enter a project's or investment's cash flows period by period to get its net present value at your discount rate, the internal rate of return (IRR), modified IRR, the payback period (simple and discounted) and the profitability index — the standard tools for deciding whether an investment is worth it.
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Your inputs
Quick start — try a typical case
Money spent as negative, money received as positive. The first row is today (not discounted).
Your required return or cost of capital.
Your result Live
Net Present Value — Worth Doing
₹67,255
At a 10% discount rate; IRR 12.64%
- Profitability Index (benefit–cost ratio)
- 1.067
- IRR (per year)
- 12.64%
- Modified IRR (per year)
- 10.54%
- Payback Period
- 3.33 years
- Discounted Payback
- 4.46 years
- Undiscounted Net Cash
- ₹4,00,000
Discounted cash flows
6 rowsNPV treats the first row as today. Excel's NPV() discounts the first value too; use =NPV(rate, later flows) + first flow to match.
How this is calculated
NPV = Σ CFₜ ÷ (1 + r)ᵗ · IRR: the r where NPV = 0 · PI = PV(inflows) ÷ PV(outflows)
- r
- Discount rate per period (the yearly rate converted to the row period)
- MIRR
- (FV of inflows at the reinvestment rate ÷ PV of outflows)^(1/n) − 1
NPV discounts every future cash flow to today's value at your required return and adds them up: a positive NPV means the investment earns more than that return. IRR is the return at which NPV is exactly zero. When cash flows change sign more than once, IRR can be misleading, so the calculator also shows MIRR, which assumes a realistic reinvestment rate.
Assumptions & sources
- Cash flows occur at the end of each period; the first row is today.
- The yearly discount rate is converted to the row period by compounding (e.g. monthly = (1 + r)^(1/12) − 1).
- For dated, irregular cash flows use the XIRR Calculator.
- 1Excel financial functions (FV, PV, PMT, NPER, RATE, NPV, IRR, XIRR) — the convention spreadsheets and banks use — Microsoft Support
- 2CFA Program Curriculum — Quantitative Methods: The Time Value of Money — CFA Institute
- 3Investments (Bodie, Kane & Marcus), chapters on returns, compounding and the time value of money — McGraw-Hill
Calculator ID FIN-RET-IRRNPV-001 · version 1.0.0
Common questions
NPV or IRR — which should I use?
NPV for decisions: it tells you how much value a project adds at your required return. IRR is a convenient summary, but can mislead with unusual cash flows or when comparing projects of different sizes.
What discount rate should I use?
Your required return: your cost of borrowing, or the return you could get on an investment of similar risk.
What is a profitability index?
PV of benefits ÷ PV of costs. Above 1 means the project creates value; it's handy for ranking projects when money is limited.