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How do I calculate the inflows and outflows for the entire 0-5 years using Internal Rate of Return (IRR) with the information below: Cash Outflows:

How do I calculate the inflows and outflows for the entire 0-5 years using Internal Rate of Return (IRR) with the information below:

Cash Outflows:

  • Software Licensing:
  • $87,000 over 3 years, starting in year 1
  • Cloud Hosting:
  • $1,250 monthly, starting year 0
  • Software Maintenance/Support:
  • $5,000 annually, starting year 1
  • Implementation Costs:
  • $75,000 year 0 only

Cash Inflows:

  • Increased Revenue:
  • $13,500 annually, starting in year 1
  • $19,500 annually, starting year 4
  • Reduces Labor Expense:
  • $5,000 annually, starting in year 1
  • Reduced Infrastructure Expense:
  • $18,500 year 0 only

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