Sum and discount multiple yearly cash flows to check whether an investment creates value at your discount rate.
V1: yearly model only — periods are full years (year 0, 1, 2…). You can compare two discount rates and expand a discounted cash flow table (including the initial outlay). For a single future lump sum, use the present value (PV) calculator.
Enter data and click Calculate.
NPV (net present value) = Σ CFt ÷ (1 + r)^t for t = 0…N, where CF₀ is usually the initial investment (negative), and each following CFt is a future yearly cash flow discounted at rate r.
If NPV > 0, the project creates value beyond the alternative return at this discount rate. If NPV < 0, it destroys value.
The calculator also shows the undiscounted (nominal) sum and the point where cumulative cash flows — nominal and discounted — turn positive.
You can optionally compare NPV at rate A and B. The breakdown table includes all cash flows including year 0 (initial outlay) — the sum of the PV @ A column equals the primary NPV.
NPV generalizes present value (PV) to multiple periods — if you only have a single future amount, the PV calculator is simpler.
NPV ≈ 2,261.43
Undiscounted sum ≈ 5,000.00
Positive NPV — at an 8% discount rate the project creates value beyond the alternative return.
NPV ≈ -1,405.95
Undiscounted sum ≈ 15,000.00
The terminal value added to the last year raises NPV, but at a 10% discount rate the project still comes out negative (NPV ≈ -1,405.95).
NPV ≈ -6,719.81
Undiscounted sum ≈ -3,000.00
A high discount rate (12%) strongly reduces the value of later cash flows — NPV comes out negative (≈ -6,719.81).
NPV @ 8% ≈ 2,261
NPV @ 12% lower · Δ negative
A higher discount rate lowers NPV for the same project — that is why comparing A vs B is useful.
The sum of all cash flows discounted to today at your rate — a positive value means the project creates value beyond the alternative return.
PV values a single future amount or a series of equal payments. NPV sums any (including uneven) cash flows over time — each discounted separately, then added up.
The project roughly matches the discount rate — in this model it is "indifferent" versus the alternative return.
Not in v1 — currently yearly periods only (year 0, 1, 2…). Shorter periods are planned for a future update.
It adds a one-time amount (e.g. resale value of an asset) to the cash flow in the last year, before discounting.
Getting the sign of the initial investment wrong (it should be negative), or using a discount rate that is too low or too high.
The year from which cumulative cash flows — nominal and discounted — become non-negative; a simple payback indicator.
With IRR (internal rate of return) for a percentage view, and with PV when you are analyzing only a single future amount.
The second rate (B) lets you compare NPV at a different cost of capital. The table shows each cash flow including year 0 — the sum of PV @ A equals the primary NPV.