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I have NPV, how do i solve to find the cash flows?

4 year project, all cash flows are the same, is there a formula for this?????

1 Answer

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  • JKRB
    Lv 7
    8 years ago
    Favorite Answer

    You would also need the initial cash investment and the discount rate.

    payment = PV / [(1- (1 / ((1 + i)^n) )) / i]

    Where:

    PV = Present Value (add your NPV + initial cash investment)

    i = interest per period

    n = number of periods = 4

    Example:

    NPV = 20,000

    Initial investment = 100,000

    Discount rate = 8%

    payment = 120,000 / [(1- (1 / ((1 + 0.08)^4) )) / 0.08]

    payment = $36,230.50

    Source(s): Accounting Fan
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