A B D E F 1 CAPBUD Capital Budgeting $500,000 10 years $25,000 $110,000 20.00% years FORMULA1 FORMULA2 FORMULA3 FORMULA4 2 3 4 5 Data Section 6 7 Cost of investment (initial outlay) 8 Estimated life of investment 9 Estimated salvage value 10 Estimated annual net cash inflow 11 Required rate of return 12 13 Answer Section 14 15 Payback period 16 Accounting (average) rate of return 17 Net present value 18 Internal rate of return 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 Scratch Pad Cash flow table needed for NPV & IRR calculations NPV IRR Annual Salvage Combined Year Cash Flow Value Flows 0 -500000 110000 0 110000 2 110000 0 110000 3 110000 0 110000 4 110000 0 110000 5 110000 0 110000 6 110000 0 110000 7 110000 0 110000 8 110000 0 110000 9 110000 0 110000 10 110000 25000 135000