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Capital Budgeting Decision Model

General overview

 The capital budgeting model is constructed to evaluate potential major projects or investments that would require capital budgeting before they are approved or rejected, it helps CEO, CFO and entrepreneurs to assess a prospective project’s cash flow to determine whether the potential returns that would be generated meet a sufficient target benchmark

The capital budgeting model allows the user to calculate the net present value (NPV), internal rate of return (IRR), regular payback, discounted payback and profitability index from simple cash flow stream with dynamic investment decision

The model helps the users to avoid failure or going out of business and improve the power for knowing the numbers to make business decision

The template is fully-editable / customizable model

Inputs

  • Update the general info in the Front Page
  • Enter the initial investment in the green cells on cell C8 & C9
  • Enter the discount rate element in the green cells from cell C19 to cell C27
  • Enter the cash flow in the green cells from cell E13 to cell N13, this model is for maximum 10 years investment

 Outcome             

  • Weighted average cost of capital or Discount rate
  • Regular payback period
  • Discounted payback period
  • Net present value NPV
  • Internal rate of return IRR
  • Profitability index PI
  • Investment criteria and decision
  • Capital budgeting ranking between small firm and big firm
  • Dashboard with 3 scenario analysis by choosing the selection box showing on top on the chart

Conclusion and customization

Highly versatile, very sophisticated financial template and friendly user

If you have inquiries, please contact us

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